Financial Institutions Take on Human Trafficking

By Sophie Kasakove

In a piece for In Sight Crime this week, Daniela Guzman discusses the efforts of financial institutions to crack down on human trafficking.

Like any business, human trafficking operations rely on financial institutions as the destinations and conduits of its proceeds. Guzman notes recent cases in the United States and Canada in which human trafficking gangs have used “money services businesses to pay off transporters, prepaid cards to move funds across borders, and individual bank accounts to funnel profits back to gang leaders.”

Rather than fall prey to human traffickers, financial institutions are eager to use their leverage to crack down on human trafficking using new monitoring techniques. One tactic highlighted in the article is the creation of rules and typologies for transaction monitoring systems that detect patterns and behavior indicative of human trafficking. For example, Iowa-based bank MetaBank has developed a program with NICE Actimize, a monitoring systems company, focused on the use of pre-paid cards. MetaBank is also working closely with law enforcement agencies to swap information that can trigger criminal investigations of human trafficking.

Last year, several banks, including JP Morgan Chase, Bank of America, and Wells Fargo joined a human trafficking working group in cooperation with Manhattan District Attorney Cyrus Vance. The project, supported by the Thomson Reuters Foundation, is an opportunity for financial institutions to exchange best practices. District Attorney Vance stated, “Prosecutors need every available tool in the fight against this terrible crime, and financial forensics are amongst the strongest in our arsenal… Human trafficking, at its core, is a business. Like other businesses, it leaves a financial paper trail that can be tracked and used to identify trafficking networks.”

“Financial forensics” is an especially important tool because it can identify—and help secure convictions against—traffickers without having to rely solely on victims, who are often unable or unwilling to testify out of fear of or emotional attachment to their traffickers. Suspicious financial behaviors identified by the working group include: regular transfer of funds from the employees’ accounts back to the employers (indicative of labor trafficking), recurrent business transactions outside the time of known business operations, cross-border transfers of funds inconsistent with the stated business purpose of the financial institution’s customer, and a high number of individual accounts opened and closed simultaneously. A detailed investigation of common human trafficking-related financial transactions can be found in a manual created by NGO Finance Against Trafficking, called “Suspicious Financial Activity and Human Trafficking.”

It is the responsibility of financial institutions to take advantage of their unwitting position within human trafficking operations to disrupt the networks that benefit from slavery. Human Rights First urges financial institutions to make use of the financial forensics tools, and to create their own tools to fight trafficking.


Published on July 11, 2014


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