US ‘Perfect Playground' For Laundering Money Linked To Environmental Crimes, New Report Finds

2nd November 2023

From the International Consortium of Investigative Journalists.

It's no secret that the United States has become a destination for the proceeds of crime. But the impacts of those crimes are often hidden.

A new report from the FACT Coalition, which represents more than 100 transparency and conservation groups worldwide, reveals how "critical gaps" in the U.S. anti-money laundering system enable environmental crimes, including the destruction of one of the world's most important ecosystems, the Amazon rainforest.

FACT's analysis focuses on illegal logging and mining in Peru and Colombia, and shows how financial secrecy is exploited by the criminals responsible, many of whom use U.S. shell companies to mask their identities, fund their operations and launder dirty money.

"It's slowly killing our people, our fish and our rivers," said Julio Cusurichi, an indigenous leader of Peru's Shipibo-Conibo community, whose rivers have been poisoned by mercury.

U.S. financial authorities have recently sounded the alarm over illicit financial flows linked to environmental crimes and corruption but FACT warns that key anti-money laundering reforms have stalled.

The group argues that the U.S. Treasury’s long-awaited database of company owners should be made available to trusted foreign law enforcement, while the white-collar professionals who set up opaque financial structures should be held accountable.

Earlier this year, ICIJ’s Deforestation Inc. investigation also exposed flaws in the U.S. sanctions meant to block the importation of forest products of uncertain legal origin, such as timber harvested in conflict zones.

"Unless the U.S. implements comprehensive reforms ... it will continue to provide an avenue for criminal actors wanting to abuse our financial system and launder environmental crimes proceeds," said Ian Gary, FACT’s executive director.

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