On risk - insurance

Insurance, notably the life sector, is vulnerable to criminal abuse according to the latest Financial Action Task Force Typologies but reporting by the industry is low. Alan Osborn investigates.

In this summer’s “Money Laundering and Terrorist Financing Typologies 2004-5” the Financial Action Task Force (FATF) analysed 94 reported cases of money laundering through the insurance industry between 1999 and 2003 with a total value of US$525 million. The average figure was US$2.1 million per case in developed countries but rather less if a single outlier of US$370 million is excluded. In value terms the money was mainly laundered through life insurance products – they accounted for 65% of cases worth US$520 million.