On 16 March 2016, judicial and law enforcement authorities from Germany, supported on-the-spot by Europol experts, took action against an Iraqi organised crime group based in Germany suspected of performing money laundering services for international heroin traffickers. The operation was preceded by extensive and complex criminal investigations supported by Europol, which coordinated the law enforcement authorities in France, Spain, Germany and the Netherlands, mirrored by Eurojust’s coordination of the judicial authorities.
The operation was conducted by hundreds of police and customs officers and resulted in a number of house searches and the arrest of five suspects, who were remanded in custody. This criminal syndicate, composed mainly of Iraqi nationals, was responsible for collecting the proceeds of heroin sales throughout Europe (Spain, the Netherlands, Italy and the UK) and laundering these funds to the Middle East through Germany, with an estimated total amount of EUR 5 million already laundered.
The criminals’ modus operandi involves the use of cash couriers traveling by car to pick up dirty cash all over Europe, followed by the use of trade-based money laundering techniques to forward the collected assets to the Middle East: expensive second-hand cars, heavy machinery and construction equipment are purchased in Germany and subsequently exported to Iraq, where the goods are ultimately resold in exchange for cash. The organised crime group can then make use of Money Service Businesses and unregulated financial channels (the Hawala system) to integrate and further transfer funds to the regular financial system, thus leaving virtually no tell-tale paper trail evidence for law enforcement investigators.
Igor Angelini, Head of Europol’s Financial Intelligence Group, said: ‘Drug traffickers still need to get rid of the cash generated by their criminal activities. Professional money launderers offer such services: they collect the cash, move it to countries where large cash payments are possible to buy cars, industrial machinery and other high-value items which are then exported outside the EU. The criminal business is still done in large part in cash. The introduction of thresholds to cash payments is an effective anti-money laundering and counter-terrorist financing practice.’
Gabriele Launhardt, Deputy National Member for Germany at Eurojust, commented: ‘To fight heroin smugglers, fraudsters as well as terrorists, all using financial circuits for their crimes, we need to follow the money trail. This is one more and very successful proof point to the importance of cross-border cooperation in fighting serious organised cross-border crime. As the criminals operate across the borders, so does the justice system, in order to be effective.’
Europol has been supporting this operation since December 2014 by providing analytical and operational support (cross-matches, operational analysis, and commercial intelligence reports) to all involved Member States. A mobile office was deployed to Wiesbaden for the action day, allowing Europol experts to assist the German authorities in the extraction of data from digital and communication devices. Real-time intelligence analysis aimed at identifying further transnational links was also provided on the ground.