FINTRAC flags human trafficking risk

Ahead of the FIFA World Cup’s arrival next month in Toronto and Vancouver, federal anti-money laundering authorities are warning that major global sporting events often attract human trafficking, and highlighting the financial red flags associated with these crimes.

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) issued a special bulletin on the risks of human trafficking that arise from major international sports and entertainment events — which can drive tourism and boost economic activity, increasing the demand for “services, labour and transactions,” which can also intensify the conditions for both sexual exploitation and forced labour.

The bulletin, which aims to help firms identify financial activity associated with trafficking, sets out indicators that can be associated with both sex trafficking and forced labour — including greater usage of cash, mobile payments, peer‑to‑peer transfers, and financial flow patterns associated with potentially suspicious activity.

“During the events, traffickers may increase reliance on transaction techniques that help evade detection, including transaction structuring, round‑dollar transfers, prepaid or stored‑value instruments, or advertising credit systems to obscure underlying financial flows,” it said.

Additionally, the bulletin highlights the type of information to be included in reports of suspicious financial activity that can help FINTRAC’s analysis of this activity.

“Human trafficking is a devastating crime that often thrives in moments of heightened activity, including major international sporting and entertainment events. Combatting it requires strong, coordinated action between public authorities and the private sector, whose insights are critical in identifying suspicious financial patterns,” said Stéphane Sirard, acting director and CEO of FINTRAC, in a release.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.