Jewellery Exporter — Trade Based Laundering

Background

You sit in the trade-based money laundering desk of a bank's financial crime unit. Trade finance operations has referred an export customer after repeated invoice discrepancies.

Customer

Meridian Gems Exports Pvt Ltd — a Mumbai gems and jewellery exporter with a five-year relationship and an export packing credit limit.

Your objective

Establish whether the export flows represent genuine trade, and decide the disposition of both the relationship and the credit facility.

Initial concern

Export invoices price polished stones far above independent market valuation, and 87 percent of proceeds arrive from three related buyers in a single free zone.