Who can send information to TRACFIN?
TRACFIN only deals with statements from the professionals mentioned in article L.561-2 of the Monetary and Financial Code. The service also receives information from professional supervisory authorities, the public sphere and the counterparty financial intelligence unit.
The most impressive clandestine financial circuits of 2021
The 2021 report zooms in on some clandestine financial circuits and highlights four main typologies:
- money laundering of criminal origin,
- damage to public finances,
- prevention of terrorism, organized crime, and the protection of economic interests,
- anticipate the risks of “crypto-laundering”.
Laundering of funds of criminal origin
The 2021 report of TRACFIN details the various techniques for laundering criminal funds that the agents that make up the service have to deal with. Example: u launder the proceeds of fake transfer order scams (OBVIOUSLY). It is one of the main threats of money laundering in France. The circuits identified thus pass through a succession of bank accounts or payment accounts opened in several countries through which fraudulent funds circulate very quickly. In 2021, 25 cases of this type were handled by TRACFIN.
him real estate sector, which has been very dynamic in recent years, is also a privileged vehicle to reintegrate the proceeds of organized crime fraud into the real economy. The risks of the injection of illicit funds exist at all stages of the life of a real estate project, from the construction project to obtaining the real estate loan, explains TRACFIN. A fight that requires increased vigilance from professionals in this sector.
In 2021, TRACFIN also studiedanalysis of accounting data and annual accounts of the company. This is put in parallel with the analysis of their financial flows to identify possible manipulations and accounting falsifications in addition to other crimes such as the misuse of corporate assets, bankruptcy, fraud and abuse of rights.
In 2021, Tracfin increased its participation in the dismantle child pornography content distribution networks continuing to follow the financial flows that allow the financing of these networks. This mission is part of a context where the health crisis has favored the international expansion of the phenomenon and where payments are now increasingly made in cryptoassets (digital assets). The modus operandi of these networks consists in sponsoring, against payment, the rape, sexual assault, or even the torture of a minor and to witness it live. A criminal practice localized and organized mainly in the countries of Southeast Asia, but which extends geographically, also in the countries of Eastern Europe.
What is money laundering?
This is an offense consisting of facilitating, by any means whatsoever, the false justification of the origin of the property or income of the perpetrator of a crime or an offense that has provided him with a profit directly or indirectly. It also denotes the fact of providing assistance to an investment operation, concealment or conversion of the direct or indirect proceeds of a crime or misdemeanor.
The fight against attacks on public finances
These attacks on public finances are understood, in the broadest sense, as the misappropriation for fraudulent purposes of a device involving public funds. In 2021, the assumed financial interests of the information sent to the anti-fraud services have increased compared to the year 2020 to reach 853 million euros.
This response mission led by TRACFIN covers both:
- tax evasion,
- social security fraud,
- customs fraud,
- misappropriation of public aid schemes (employment and economic activity support schemes),
- misappropriation of tax exemption schemes (energy transition support schemes, investment incentive schemes).
In 2021, TRACFIN has therefore revealed four trends in this context:
- a persistence, even an aggravation, of fraud in the personal training account (CPF) with a 12-fold increase in suspicious transaction reports. This has resulted in new scam methods implemented by fraudsters who have adapted to the strengthening of system security at the end of 2020. CPF fraud now manifests itself through more diverse mechanisms. Learn more.
- the continued deviation of the emergency measures put in place in the context of the health crisis, in particular the compensations for partial activity, the solidarity fund and, to a lesser extent, the loans guaranteed by the State. TRACFIN notes in its report that these frauds continued in 2021, although they were less significant compared to 2020. In total, 50 files were processed in 2021,
- Constant vigilance on state aid schemes, including more specialized sectoral schemes such as the National Fund for Sustainable Employment in Entertainment (FONPEPS), the ecological bonus and the conversion. For these last two schemes, ineligible companies managed to obtain subsidies using intermediary structures and false declarations,
- in the continuity of data leaks that reveal the existence of offshore finances organized to encourage tax evasion, TRACFIN has continued its active work to identify the actors and owners of these structures.
What is tax evasion?
Tax evasion is based on the transfer of assets to another country, whose tax regime is more advantageous, especially to tax havens. For the taxpayer, the goal is to reduce the amount of levies that he usually owes to the State. It is on the border between tax evasion and optimization.
To prevent the financing of terrorism and organized crime
TRACFIN brings specific know-how to the partner services with which it collaborates as part of the animation of the intelligence and the fight against terrorism.
With this in mind, TRACFIN has an effective tool for financial obstacles, the freezing of assets. In 2021, TRACFIN thus transmitted 94 notes relating to measures to freeze assets. As part of the Ukrainian crisis, in 2022, 22.8 billion euros were also blocked in the French accounts of the Central Bank of Russia, to which were added 1.1 billion euros of frozen financial and non-financial assets. However, TRACFIN has identified several methods of avoiding the device:
- recourse to a third party close to the family or to the professional circle, to members of the same organization or community. They collect or receive funds for the benefit of the person whose assets are subject to a freeze,
- the use of online banks and payment service providers operating in the national territory under the freedom to provide services,
- the use of crypto-asset trading platforms established in France or abroad. It allows the fragmentation of the chain to hold assets by ensuring the movement of crypto-assets from one blockchain to another.
TRACFIN also pursues the priority objective of identifying drug trafficking laundering circuits. Almost 800 reports, related to suspected drug trafficking, were thus received in 2021, with an average of 417,000 euros in financial payments per file. Some cases have led to arrests or seizures in the corridors linking France to the Guyana/Suriname area and the Balkan countries.
Anticipate the risks of crypto-laundering
The attention of the service in terms of cryptoassets, or digital assets, focused in particular in 2021 on the monitoring of financial flows from ransomware cyberattacks. These are attacks in cyberspace in the form of malware whose function is to encrypt and block access to the victim’s data. Access is restored by a decryption password transmitted by the attackers in exchange for a ransom paid in cryptoassets. Attacks that have experienced a marked increase in recent years with a 194% increase in incidents handled in two years by the National Agency for the Security of Information Systems (ANSSI). A movement that affects all sectors of activity, with a significant part of the attacks aimed at very small, small and medium enterprises (52%).
TRACFIN also remains on active standby to monitor the the development of financial innovations allowed by blockchain technology and decentralized finance (DeFi) and warn, if necessary, about the vulnerabilities they present.