(Photo credit: Lucas Favre, via Unsplash)
Every one of the 33 counties on or very nearly on America's southern border, from Texas to California, is considered a "high intensity" area for either drug or financial crimes, with a vast majority of them labeled as both, according to a new government report.
While the laundering of drug money contributes to the high-risk of financial crimes -- especially through bulk cash transactions -- other factors make money especially difficult to trace there, said the report, published Monday by the Government Accountability Office. Others include cash payments to agricultural laborers and frequent cross-border financial transactions. Potentially the most significant, the report says, are transactions by "senior foreign political figures" that create "additional money laundering and terrorist financing risk[s] because of the potential for their transactions to involve the proceeds from foreign-official corruption."
The eye-brow-raising transactions have led the banks to file far more "Suspicious Activity Reports" (SARs) than other counties in the same states -- about three times as many from 2014 to 2016.
All in all, it appears this activity is bad for business for the bank's local branches. The GAO report noted that the branches have been closing steadily since 2012. This is a national trend as well, according to the GAO, but all the suspicious activity certainly isn't helping, as banks have to work harder and expend resources to ensure they're in compliance with financial regulations that much more often.
Primary Source: GAO Report on the Southern Border Counties
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