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Introduction
Enabling Factors
Illegal markets create the conditions for which other services are needed to help the markets operate. Following are highlights of some key criminal methods that facilitate how illicit goods or services are performed, manufactured, transported, distributed, or imported/exported.
Money Laundering
Money laundering is a key activity that enables groups to continue their criminal Activities, maintain possession and control of their profits and reinvest in further criminal endeavours. There are numerous ways to launder criminal proceeds that evade regulatory requirements. Traditional methods involve white-label ATMs, the use of front companies, currency exchanges and multi-jurisdictional and off-shore transactions. Newer avenues include the use of prepaid cards, which are portable, valuable, exchangeable and anonymous. Another newer trend is transactions involving precious metals through digital currency exchange services, which are not tied to banks.
White-label ATMs. Automatic banking machines (ATMs) that are referred to as "white-label" provide an alternative source of cash dispensing in place of traditional branded ATMs from banks. "White-label" or "no name" ATMs are independently operated and display no major financial institution or bank labels.
Cyber techniques
The use of technology for criminal purposes poses significant threats to legitimate institutions and the public. It offers criminals more anonymity and the possibility of conducting illicit activities across numerous jurisdictions, often perpetrated using misleading Internet Protocol (IP) addresses that make it difficult to pinpoint the origin of an attack. Several tools are available to cyber criminals seeking to defraud consumers and conduct large-scale data theft. Botnets, for example, are used to compromise legitimate websites, including those of private industry and the government, and expose the online community to the potential for large-scale data theft of personal and financial information. Cyber criminals also target online shopping and credit provider sites using malware and keystroke-logger programs to steal the credit card data required to produce counterfeit cards. These skills and tools bypass skimming activity at point-of-sale terminals and ATMs. Phishing schemes, another popular tool
for cyber criminals to steal credit card data, use malicious mirror sites of financial and banking institutions, as customers increasingly turn to the Internet to seek out attractive offers and conduct their banking.
Botnets are networks of hijacked computers used to spread unsolicited email, malware and crimeware such as trojans, viruses and related hostile code to unsuspecting commercial and private users of the Internet.
Malware is malicious software specifically designed to gain access or damage a computer system without the owner's informed consent. It includes computer viruses, worms, trojan horses, spyware, crimeware and other unwanted software.
Keystroke logging is the practice of observing and recording the keys struck on a keyboard. This is typically done in a covert manner so that the person using the keyboard is unaware they are being monitored. There are numerous keylogging techniques that range from hardware and software programs to electromagnetic and acoustic analysis.
Skimming is the theft of credit card information used in an otherwise legitimate transaction. Common scenarios involve the skimmer having possession of the victim's credit card out of immediate view; for example, skimming can be facilitated by a dishonest employee of a legitimate merchant. The thief can procure a victim's credit card number by photocopying receipts or using a small electronic device that can swipe and store hundreds of credit card numbers.
Phishing involves the use of fraudulent e-mail messages and websites that appear to originate from a legitimate company – such as a bank, online retailer or government agency – to obtain personal information from victims.Criminal specialists and niche skills
Where critical skills necessary to facilitate criminal activities are absent within a criminal group, skilled outsiders are recruited or exploited to provide this service. The individual may be considered an outside contractor or part of the criminal network. Services can range from accountants, lawyers, chemists, commercial truckers, helicopter pilots, hackers and cyber criminals to those with access to particular goods, such as firearms, false documentation or vast quantities of financial data. There are money laundering specialists, for example, who launder money for several criminal groups and charge commission for the service. Criminal networks also make use of those who can facilitate extortion, debt enforcement, kidnapping or murder.
Criminal enterprises, particularly those that involve shipments of commodities to consumer regions, require coordination to resolve often-complex logistical problems. Working capital must be identified and procured, and individuals would need to be contracted to perform all the tasks, including the manufacture or procurement of goods, their transportation, storage, protection, distribution and sale, the manufacture of any necessary documentation, the paying of bribes, and the laundering of criminal proceeds.
Violence and territoriality
Violence is used by organized crime of all levels of sophistication and capability. However, in some instances, criminal groups with lower-level capabilities will pose a more immediate and direct public safety threat through acts of violence that are often carried out in public places. These violent, lower-level criminal groups are largely but not entirely composed of street gangs, some of which have committed assaults or shootings in public places across the country. The criminal groups have also been known to intimidate communities or specific individuals by prominently displaying their gang-related paraphernalia to silence witnesses of crimes. The degree of street gang violence utilized differs by region and gang. Competition between organized crime groups over territory or a particular illicit commodity can flare spontaneously and lead to inter-group conflict that threatens public safety.
Secure communications
The ability to communicate securely and avoid detection is essential to the operations of organized crime groups. Mobile wireless technology and personal digital assistants are used to facilitate instant communication between group members. In addition to face-to-face meetings, criminal groups make use of disposable cellular phones to conduct their criminal activities.
Internet-based communications provide instant and anonymous means to both coordinate and perpetrate criminal activity. The enhanced security and encryption features of some of these technologies pose both logistical and legal challenges for law enforcement, making it difficult to infiltrate the criminal networks that employ them.
Corruption
To obtain access to information or thwart enforcement or regulatory processes, organized crime groups target a wide range of occupations to facilitate criminal activity. For example, the corruption or collusion of individuals working at points of entry continues to play a role in the international movement of illicit commodities. Targets of corruption and collusion can extend to a range of criminally inclined individuals being exploited from baggage handlers and ground crews, to various resource and supply services, as well as to law enforcement and public officials.
"Organized crime is so pervasive it demands coordination among federal government departments and intelligence agencies, the provinces, law enforcement agencies and private sector organizations. No single organization has responsibility for addressing this problem. We all must share information and work together to ensure Canada's economic integrity." Canadian Bankers Association, Director of Security, William J. Crate
Criminal Markets: National Overview of Criminal Markets
