National Crime Agency officers have warned registered Hawaladars in the UK of the consequences of being involved in organised immigration crime.
Hawaladar systems serve entirely legitimate purposes but are known to be exploited by criminals looking to move criminal cash, including from small boat people smuggling activity.
Visits to 44 businesses across the UK were delivered by the NCA, in coordination with HMRC, over two days, 25 and 26 February. They were also attended by officers from 9 forces – a show of joint commitment to increase intelligence on financial flows linked to those who facilitate and enable people smuggling.
Hawala is an informal value transfer system that operates based on the transfer of value without the actual movement of money. It relies heavily on trust – between hawaladars and their customers and within the networks.
These systems are used for various reasons – such as cheaper or faster money transmission, cultural preference, lack of confidence in banks, or because they are the only channel through which funds can be transmitted in certain conflict regions.
In the UK, they are subject to regulations and standards. They must comply with the Money Laundering, Terrorist Financing and Transfer of Funds Regulations and are legally required to report anything suspicious to the NCA.
Those who do not do so risk criminal charges, heavy fines, business closures and severe reputational damage. Those who take payment from people smuggling activity, whether willingly or unwittingly, are helping to fuel a crime that endangers the lives of thousands.
Last year, following a National Crime Agency investigation, Iranian hawaladar Asghar Gheshalghian was sentenced to eight years in jail after being convicted of running an unregistered money services business that served people smuggling networks.
Gheshalghian acted as a trusted middleman, accepting payments from migrants or their families and then releasing money to the criminal gangs following the completion of their journeys to the UK, charging a commission at the same time.
This week’s activity was designed to emphasise the importance of vigilance signpost reporting mechanisms and warn all those working in the sector that a failure to comply with legislation will result in serious consequences. It will be paired with further activity over the coming months.
Alex Murray, the director of Threat Leadership at the National Crime Agency, said, “Organised immigration crime is a deadly threat that led to more than 70 fatalities in the Channel last year alone. Criminal gangs are behind these crossings.
“The National Crime Agency has around 70 ongoing investigations into people smuggling networks, and we are determined to do all we can to target those involved – including those who enable, support, and financially benefit from this criminal activity.”
Louise MacDonald, Deputy Director of Economic Crime at HMRC’s Fraud Investigation Service, noted that businesses that fail to comply with money laundering regulations leave themselves and the UK economy open to criminal attacks, including those involved in organised immigration fraud.
“We know many registered Hawaladars provide vital and legitimate services to scores of communities,” MacDonald explained. “That’s why we’re working with partners at the NCA to help protect them from criminals who would prey on their services, and we will use all our powers to tackle those who fail to meet their legal obligations.”
Minister for Border Security and Asylum, Dame Angela Eagle, reiterated that law-abiding Hawaladars have a responsibility to report suspicious activity, “and as this warning makes clear, we will not hesitate to prosecute those who enable people smugglers to profit from putting countless lives at risk.”
