Companies that need help with regulatory compliance know they need it. They know that not being compliant is illegal, and they know that not being compliant may have an impact on their bottom line. They know that the cost of compliance can be high, both in terms of staffing and time, and, in the process of keeping those costs down, they may forego options that could provide them with stronger risk assessment. Business managers see the cost of risk and compliance as an operational expense that hurts the bottom line of their business, but, most don’t understand — or can’t quantify — the human misery they could be unwittingly abetting when they don’t take anti-money laundering (AML) measures seriously. The intent of AML is to stop nefarious actors from abusing the financial system. An effective AML infrastructure may reduce bad actors’ opportunities to cash out from their illegal activities.
One particular illegal activity — and the topic of this blog post — is human trafficking, and in particular child trafficking. Human and child traffickers rely on black market financial systems to profit from the vulnerability of the innocent, the unaware, and the powerless. The global child trafficking pandemic would cease if the financial proceeds of criminal conduct could not be laundered — it’s really that simple in principle, perhaps not as easy in practice. Instead, we have companies and financial firms of all shapes and sizes being used to launder money around the world. Sometimes, these entities are willing participants, but more often than not, these companies, platforms, and infrastructures are used without the knowledge or against the will of proprietors in the US and across the globe.
At IdentityMind, we believe strongly in stopping bad actors involved in financial crimes and the human crimes that sit behind them. In fact, this was one of the basic premises and a fundamental tenet at IdentityMind — how can we, through technology, bring integrity back into digital financial transactions? We know that our efforts are only part of the solution. As technologists who believe that we can make a significant dent in financial crimes with software that builds and evaluates digital identities, we have always realized that money is just the tip of the iceberg.
Among the most upsetting and cruel activities that rely on the financial system is the trafficking and exploitation of children — especially here in the US, where according to Erase Child Trafficking, 46 children per day are taken and sold into modern slavery. According to the Huffington Post and Unicef, there are more than 1.2 million children trafficked each year, and an estimated 17,500 of these are trafficked in the US alone. While it is true that estimates of the numbers of sexually exploited children vary from one study to the next, not all children who are exploited are in “poor” or developing nations or regions of the world. End Child Prostitution, Child Pornography, and the Trafficking of Children for Sexual Exploitation (ECPAT) estimated between 100,000–300,000 children or more are trafficked globally each year. And, according to a study from the University of Pennsylvania, nearly 300,000 youths are currently at risk of being sexually exploited for commercial use as young as five years of age. These children are sold for sex, organ harvesting, slavery, adoption, and other horrific crimes against humanity.
Whether you have children or not, this should strike a nerve and serve as a massive wake-up call. As Ewelina U. Ochab writes in Forbes, child trafficking has reached pandemic levels, with crimes after trafficking like slavery, sexual violence, forced marriage, and rape on the rise across the globe. Child trafficking is pervasive in the US and other countries in part because our children are more accessible now than ever before through the Internet, gaming, and other social media venues. As Erin I. Kunze writes in the Journal of High Technology Law, the Internet and various online channels have become resources used by traffickers to find and sell women and children while concealing their own identities. It is this ease of access coupled with the anonymity offered by the Internet that makes anti-money laundering that much more necessary to fight evil; when those who wish to launder money are met with robust AML, they simply cannot use synthetic or stolen identities to do so, and beating them here is a big part of winning the battle against human trafficking.
At IdentityMind, we believe that putting an end to child trafficking is a critical part of why AML compliance is important, and something that should be on the radar of every company that needs an AML compliance solution. While many consider the risks associated with not being AML compliant, few consider the impact that anti-money laundering solutions can have on the lives of women and children around the world who are at high risk of being trafficked across borders and away from their homes.
Maintaining compliance does help to save lives, in the most literal of senses, and financial firms, fintechs, and online businesses can make a big difference in fighting against human trafficking when they choose compliance solutions that focus on the greater good for humanity rather than just how compliance solutions affect their bottom line.
We, at IdentityMind, are committed to fight against human trafficking. Find out more about what IdentityMind does by clicking here.