Baltic shells: on the mechanics of trade-based money-laundering in the former Soviet space

Graham Stack

Journal of Money Laundering Control, 2015, vol. 18, issue 1, 81-98

Abstract: Purpose - – The purpose of this paper is to describe a platform of interconnected international shell companies operated through Baltic banks, used for trade-based money laundering (TBML) across Russia, Ukraine and other post-Soviet states. Design/methodology/approach - – This is a case study that draws extensively on the results of journalist investigations and court cases to describe one example of a money-laundering platform. Findings - – Platforms of international shell companies operated through Baltic banks play a key role in TBML for the post-Soviet countries. They are created for systematic laundering of revenues from tax evasion, tax fraud, corruption and criminality across the post-Soviet space, and also globally. Research limitations/implications - – This study implies that TBML for the post-Soviet space is a specialized industry, hosted by collaborating banks centered in the Baltic states, in conjunction with mass use of international shell companies. Practical implications - – This study implies that analysis of suspicious transactions cannot remain on the level of single companies but has to take into account the interconnected payment patterns produced by such a platform. Originality/value - – Provides the first study of a trade-based money-laundering platform operating in the post-Soviet space.

Keywords: Russia; Corruption; Ukraine; Tax evasion; Trade; Banks; Latvia; Money-laundering; Shell companies; Organized crime (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jmlcpp:jmlc-10-2013-0040

DOI: 10.1108/JMLC-10-2013-0040

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