Tracing assets from a serious fraud case

An Asset Management department of a Swiss Private Bank developed a crime-friendly environment that attracted private assets and managed to extract the liquid assets deposited in the bank for an amount of about 150 Mio EUR, including our client which was victim to the fraud for a damage of about 20M USD, perpetrated between 2009 and 2012. The fraud was perpetrated systematically forging client signatures and bank statements issued by the protagonists employed by the bank. In spite of the fact that at a first view the fraud seemed to be a ponzi schema, the fraud case perpetrated by the protagonists had to be considered in a larger context of international money laundering, staring from the activities of the protagonists in 2003.

Starting from 2003, the protagonists planned and operated, with the help of international accomplices a money laundering layering structure of companies consisting in a set of off-shore companies, with bank accounts around the world, with the only aim to anonymize transactions from high-net-worth individuals and some politician, mostly located in South America, South Europe and Russia. This money laundering mechanism was in part related to a network of famous international money launderers in part serving the organized criminality in particular in East Europe and Italy. The total flow of money laundered through this mechanism was about 1'250 Mio EUR in-flow and about 1'150 Mio EUR out-flow. From 2003 and 2009, 10% of the amounts were subtracted from the money laundering scheme and ended in a set of companies controlled by the protagonists. The subtracted amounts were then redistributed among family members, some relative, friends and colleagues of the Bank. The mechanism stopped to perform abruptly around 2009. It was at this time that, for compensation of the underperformance of the money laundering machinery, the fraud of about 150 Mio EUR started damaging some bank clients.

Tracing the assets from this serious fraud case required very hard work, investigative determination, massive analytical capabilities, experience and as well as a little bit of luck. The investigative process began even before a court of competent jurisdiction award resources for an in depth investigation. An essential first step in tracing those assets was to obtain from the victims all information regarding the fraud and all possible documents related to it, bank statements, transactions, correspondence....

Public records research and surveillance was also performed as an elementary step but completely not sufficient. In spite that many countries maintain public records - that identify the ownership of real property, the principals of business entities, the parties to legal disputes, and other essential information -  it is common knowledge that criminal frequently disguise the ownership of assets in the names of close associates, family members or business entities such as trusts, foundations and corporations. In addition, in this case, the experienced fraudsters used the services of professional international money launders to move the stolen assets further beyond the reach of the law enforcement capabilities.

The complex operation was performed in several phases:

• a preliminary analysis of the events, collection of all documents and public record analysis.
• Forensic analysis of the data sequestered by the law enforcement: A systematic forensic analysis of the data, of entities, protagonists, transactions, relationships, chronologies, and statistics of financial flow... has been performed. The result of the analysis is a complete map of financial flows and clear identification of moved assets.
• Arrest and recovery of the identified assets in cooperation with the law enforcement. 

Determining the money flows was essential for the asset recovery, but was not always legal until judicial remedies were employed. Forensic analysis of bank statements, swift (or other) transactions and covert activities were the most powerful disciplines in razing a complex asset protection fortress built by the experienced fraudsters.