Clients who are overly secretive or evasive about details such as their identity, source of wealth or funds, nature of their business, the end-use of a product or about the co-signor/co-signee, residential address, beneficial owners of accounts, or reasons for choosing a particular payment method.
The address provided by a client is unknown, seems incorrect, or is a correspondence rather than a physical address (e.g. a PO Box or mass registration address).
A client identified as a manager or director of several companies linked to environmental extraction or with a history of sourcing from conflict zones or areas with high rates of land conversion or violence.
Clients who possess land management or natural resource control rights in their home country, or those who have family members or close associates with such rights.
Intermediary companies that are operating out of a rural area, particularly one in a higher risk jurisdiction or region for land conversion.
Intermediary companies that are registered in an offshore jurisdiction, particularly in one identified as having a higher prevalence of shell companies or lacking transparency in beneficial ownership.
Businesses involved in commodity trading (as these can be used to conceal illicit commodities or products, such as timber, frozen foods, plastics and rubber, or agricultural products such as coffee).
General trading companies set up as foreign entities and registered at residential addresses.
Multiple bank accounts held by a customer individually or along with closely related family members. These accounts may be held at one or more financial institutions. Such accounts may be used to facilitate the placement and layering of illicit funds.
Involvement of a client’s legitimate business in import/export, freight forwarding, customs clearance, logistics or constructions.
Any reluctance to offer information about the business at hand, the end-use of a product or about the consignor/consignee, as this could potentially be due to a shell company being set up to mask the actual ownership.
Large deposits made into personal accounts of unemployed individuals.
Deposits made into accounts which are significantly above declared income.
Account activity which does not seem in line with the declared nature of business.
Multiple customers or accounts sharing the same address or phone number without justifiable grounds, or where these are frequently changed without justifiable grounds.
A complex and illogical corporate structure, including an unnecessary number of shell companies within its corporate structure.
Individual clients holding an unrealistic number of directorships (this might indicate interconnected companies that are attempting to present themselves as unrelated).
Corporate formation patterns where companies share names, addresses or directors or where there are indications of mass registration, which could indicate an attempt to obscure ownership.
Jurisdictional irregularities, like where identified residency or nationality of company directors or beneficial owners are different to a company’s country of registration, where one of those countries is high-risk for money laundering or for land conversion-related financial crime risk.
Anomalies in financial activity which might indicate shell company behaviour: for example, where revenue seems at odds with the number of employees.
Outliers relating to company or client information; for example, a beneficial owner that is improbably young or old.
Company online presence that seems inconsistent with business activity or size (e.g. no website or digital presence, lack of specific information on webpage, or use of non-business email addresses like hotmail or gmail for business purposes).
Seemingly circular relationships or ownerships between companies, which can be indicative of attempts to obscure beneficial ownership, launder money or transact fraudulently.
Long periods of dormancy, especially if followed by a spike in revenue (criminals may strategically age companies in order to maintain a low profile before using it for nefarious means).
A trade entity registered and operating from a residential address without any industrial or commercial premises.
An entity which utilises a copy name, almost identical to a very well-known trading entity, perhaps to pretend that it is part of a larger well-established group which it has no connection to.
Clients with a lack of experience/background in a commodities sector.
Organisations in the metals sector lacking an adequate organisational structure.
Clients that are unable to provide evidence of compliance with local environmental requirements (e.g. proof of permit for environmental activity, export, land purchase/lease agreements, etc.)
Clients whose stated business is to export products of land conversion but where the volume/value is in excess of what is available in the region.
Customers with mining licenses operating in or around active conflict zones.
Individuals identified as managers or directors of several companies linked to environmental extraction.
The Environmental Crimes Financial Toolkit is developed by WWF and Themis, with support from the Climate Solutions Partnership (CSP). The CSP is a philanthropic collaboration between HSBC, WRI and WWF, with a global network of local partners, aiming at scaling up innovative nature-based solutions, and supporting the transition of the energy sector to renewables in Asia, by combining our resources, knowledge, and insight.
