PracticeConsultingFraud busters warn of euro crime surge

Fraud busters warn of euro crime surge

The head of the UK's intelligence gathering agency today issued a stark warning over the anticipated surge in money laundering and fraud as Europe switches over to the euro.

All but three – UK, Sweden and Denmark – of Europe’s 15 member states will adopt the euro on 1 January 2001.

Over the next ten months criminals will be trying to ‘clean’ their ill-gotten gains as the twelve member states swap their indigenous currencies for the euro.John Abbot, director general of the National Criminal Intelligence Service, said: ‘This is the perfect opportunity for criminals to make funds clean in a new currency.

‘Large scale money laundering will characterise this period.’

But, he said the rush to launder money may prove a benefit to law enforcement agencies as ‘criminals will be putting their heads above the parapet’.

‘These transactions will make criminal gangs much more visible to law enforcement, which will potentially lead to more arrests and more disruption of their activities,’ said Abbot.

As well as an increase in money laundering, NCIS has pinpointed two other main threats – counterfeiting and fraud – and three periods of time over the next 16 months in which these threats will occur – pre-conversion period, conversion and post-conversion. The agency also warned of the potential for armed robbery as billions of euros are transported around Europe.

Abbot said: ‘In the pre-conversion period, from now to the end of December, fraudsters will be using traditional con tricks. There may be attacks on cash in transit and in storage.

‘During conversion, from 1 January 2002 to mid-way through the year, criminals will exploit public, commercial and institutional confusion to their advantage. Exchange scams, cash smuggling and coin counterfeiting will emerge.’

‘When conversion is completed, sophisticated counterfeits will be the order of the day,’ he added.

Although the euro will not be legal tender in the UK, several British companies, such as Marks & Spencers, plan to accept euro notes and coins and millions of UK citizens will be travelling for business and pleasure to countries using the euro.

The transition period is expected to be the perfect opportunity for amateur fraudsters as well as more sophisticated organised criminals to dupe the general public. Abbot urged the British public not to be tempted by ‘cheap, quick and easy deals in pubs, clubs or on street corners’ when exchanging money into euros.

‘If the deal looks too good to be true, it is,’ said Abbot.

Links

National Criminal Intelligence Service

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