Recognizing unusual transactions
As a service provider (Dealer in High Value Goods), you are aware of the practices in your industry. Determining whether a transaction is classified as unusual depends, to a great extent, on your professional opinion. Your opinion corresponds with what is considered unusual within your profession. In addition to your opinion, there are circumstances of an unusual nature which must therefore be reported.
If one of the scenarios described in the general examples below (which are not exhaustive) arises, then this is cause to further examine whether the transaction could be connected with money laundering and/or terrorist financing. If you suspect activities of money laundering or terrorist financing, then you must report it.
Red flags – Dealer in High Value Goods
- The client purchases expensive goods without demonstrating any interest in the quality or specific characteristics of said goods
- The client does not demonstrate any interest in potential defects in these items or has little interest in the potential cost of repairing them
- The client is prepared to purchase expensive goods without making any attempt to haggle or request a discount
- The client’s expenses are so excessive and do not correspond with the pattern of expenses for a person with the profession or income of the client
- The client makes purchases more often than usual for the type of client, in its own name or in the name of others
Red flags – Dealer in Jewels
- The client purchases expense jewelry without demonstrating any interest in the nature of the jewelry and/or without taking any interest in selecting this jewelry
- The client purchases expensive jewelry that does not fit the client, given its profession or income
- The client attempts to sell the jewelry it just purchased back at a lower price without providing any valid reason for this
- The client is prepared to purchase expensive jewelry without making any attempt to haggle or request a discount;
- The client is prepared to sell jewelry at a lower price than its market value