Proactive Risk Strategy: Transnational Asset Forfeiture...

Effective strategy execution and the application of intelligence to gain increased mission efficiency is the name of the game. The public / private convergence of people, processes, systems and the fusion of relevant international incidents data establishes the playing field. The threats to the very fabric of our economic and security well-being is directly tied to the rule of law, the safety of the environment and the ability for capital to be invested with prudent risk management mechanisms in place.

If any component of this fabric becomes frayed or torn, this vulnerability threatens the overall resiliency of this "Transnational Ecosystem". The homeostasis of the "Transnational Ecosystem" is dependent on the factors associated with it ability to gain new energy, (food, water, power, money) and to continually "Adapt" to it changing environment. The ability to adapt rapidly within this ecosystem will determine who the winners are and also the survivors. So what is a good example of this "Transnational Ecosystem" that we can apply to public / private convergence and Operational Risk Management?

Although pioneered in the USA, there now appears to be a global trend to use stand-alone civil proceedings as a means of recovering the proceeds of crime in the hope that they will be more effective than proceedings that are ancillary to and dependent on a criminal prosecution. Recent examples of jurisdictions that have introduced civil forfeiture legislation include Italy, South Africa, Ireland, the United Kingdom, Fiji, the Canadian Provinces of Ontario, Alberta, Manitoba, Saskatchewan and British Columbia, Australia and its individual States, and Antigua and Barbuda. In addition, the Commonwealth has produced model provisions to serve as a template for jurisdictions that wish to introduce such legislation.

This trend towards civil forfeiture has been prompted by the nature of organized crime. Organized crime heads use their resources to keep themselves distant from the crime that they are controlling and to mask the criminal origin of their assets. For this reason it has become extremely difficult to carry out successful criminal investigations leading to the prosecution and conviction of such individuals, with the result that finances derived from crime are often effectively out of the reach of the law and are available to be used to finance more crime. Such peaceful enjoyment of the proceeds of crime damages public confidence in the rule of law and provides harmful role models. This has led to a recognition that criminal confiscation regimes may be inadequate and ineffective in certain cases.

Traditionally, the use of OPS Risk strategies associated with civil asset forfeiture have their intersection with AML (Anti-Money Laundering) and Terrorist Financing. Moving money on a global basis utilizing the modern day "Hawala" or informal value transfer system requires smart people and sophisticated systems. Putting the person at the right place with the right evidence is the investigators "Holy Grail" yet there are other effective means for increasing that resiliency in the ecosystem.

The financial meltdown and economic crisis has impacted both the "Boy Scouts" and the "Wise Guys" on how to continue to prosper. The use of such tools such as Asset Forfeiture in combination with timely intelligence both Open Source and proprietary can provide the means for another effective Operational Risk strategy in a public / private consortium. The cooperation, coordination and collaboration of banking, hedge funds, broker dealers, insurance companies and private equity firms with federal and state task forces is a growing trend.

The mantra "Need to Know" is quickly being replaced with "A Responsibility to Provide" in the intelligence community and soon to be in the ranks of the financial private sector as it pertains to adapting to the transnational ecosystem. One good example of this momentum can be found in the rapidly growing education and awareness programs focused on this very subject:

Mission Statement

AssetForfeitureWatch.com is the indispensable source of news, information and training for law enforcement professionals and others working in the asset forfeiture field. At AssetForfeitureWatch.com, we understand that turning the proceeds of crime against criminals is one of the most powerful tools law enforcement agencies have for keeping communities safe, eliminating corruption, and crippling cross-border criminal enterprises. In offering training and education, an annual conference, live and Web seminars and an interactive community, AssetForfeitureWatch.com keeps its members on the leading edge of asset forfeiture strategy and practice.

The goal is to utilize the existing international legal framework to improve the resiliency of the "Transnational Ecosystem." Beyond the banking institutions are the governments and countries themselves who must make their decisions about their own business and commerce models. These havens across the globe will continue to exist because they don't have manufacturing capacity, IT outsourcing services or a port for trading and exporting raw materials. Therefore, they will continue to cater to the needs of suspect enterprises, non-state actors and even some rogue nations states.

So what is the lesson here? Reading between the lines. Assets in your portfolio, on your books, in the warehouse or even in your personal possession may soon be the property of a government entity near you.

operational risk