• Wednesday, May 29, 2024
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BusinessDay

Billions in dirty money flies under the radar at world’s busiest airports

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Jo-Emma Larvin wheeled a baggage cart piled with suitcases through London’s Heathrow Airport in August 2020 and handed her passport to an Emirates Airline agent for a flight to Dubai.

Larvin was traveling business class with another woman and together they heaved seven heavy suitcases onto the conveyor belt. She exchanged texts with her boyfriend en route to the security line.

“Do you feel ok?” he asked.

“Yes phew,” Larvin wrote. The suitcases carried millions of dollars worth of British pounds wrapped with rubber bands and bundled in plastic.

The money was headed to an international money launderer who charged a hefty fee to clients to exchange cash for gold or other currencies. His preferred route was to Dubai from Heathrow, Nos. 1 and 2 of the world’s busiest airports for international passengers.

The U.K. requires passengers to tell customs authorities if they are leaving the country with more than the equivalent of around $10,000, but Larvin didn’t, risking arrest. The seven suitcases entered Heathrow’s baggage handling system and slid through a 3-D scanner that checked only for explosives and other potentially dangerous items.

The next morning, the women collected their luggage in Dubai without having too much to worry about: Any amount of cash is allowed to enter the United Arab Emirates, as long as it is declared. The women followed signs to customs and told authorities they had brought the equivalent of $2.8 million.

Most airports worldwide, including in the U.S., don’t scan passenger luggage for cash, a costly undertaking in equipment and personnel. Countries where all money is welcome have no obligation to report about suitcases full of cash arriving from abroad. The loopholes allow billions of dollars worth of cash to fly out of the U.K. and elsewhere to countries with fewer rules, law-enforcement officials said.

Money launderers surreptitiously introduce more than $2 trillion in proceeds from illegal enterprises to global financial systems every year, according to estimates. International airplane passengers likely ferry hundreds of billions of dollars worth of that in cash, according to figures from the United Nations Office on Drugs and Crime and the Financial Action Task Force, an intergovernmental agency that develops anti-money-laundering standards for countries.
One reason for so much airline smuggling is that penalties and scandals over customers engaged in money-laundering have prompted more banks around the world to report suspicious transactions. “You just can’t walk into a bank with this much money without being flagged,” said George Voloshin, of ACAMS, an industry group for financial crime-fighting professionals. “You will be arrested at the next branch.”

A U.K. government spokesperson said customs officers respond effectively with airport security to smuggling risks. A Heathrow airport spokesman declined to comment on its security equipment and practices. An Emirates Airline spokesperson said detecting cash smuggling was the responsibility of authorities where the cash originated.

A U.A.E. official said it was working to combat illicit financial flows, including through shared intelligence and joint operations with the U.K. The U.A.E., a global destination for the rich, was recently removed from a global financial watchdog’s list of places needing more monitoring.

Officials and industry groups said smuggling cash via airline is a relatively low risk for people hired to do the job. Larvin and her boyfriend were among an alleged three dozen smugglers working for a money launderer from the U.A.E. It seemed like easy money. Authorities believe they transported $125 million, largely from July to October in 2020.

“How the hell did they get away it—so much money in such a short space of time?” said Ian Truby, a senior investigating officer at the U.K. National Crime Agency. One answer, he said, is that airport security isn’t for crime detection, only flight safety.

Three weeks later, Larvin left for Heathrow with her boyfriend and a few million more dollars worth of cash in eight suitcases. Her boyfriend had worried about drawing undue attention with so much luggage. “It’s f—ing ridiculous,” he texted. “Talk about conspicuous.”

This account of the Heathrow cash-smuggling operation is based on documents and evidence released by U.K. authorities, court records that included text messages and photos, court testimony by money couriers, as well as interviews with investigators and people familiar with the matter.
Abdulla Alfalasi started flying cash from Heathrow to Dubai around 2017 and expanded his operation during the pandemic.

On New Year’s Day 2020, Alfalasi left Heathrow with 11 cases, weighing 463 pounds, and reported the equivalent of $850,000 in Dubai. He told a former business partner he had connections with the royal family. His father-in-law ran Dubai airport customs back when it was a shed and a table. He developed the airport into a global hub as director-general of aviation.

Later that month, Alfalasi texted Michelle Clarke, an executive assistant looking to relocate to Dubai with her children and husband, a former pro soccer player. She belonged to a fun-loving crowd in the northern city of Leeds, where she worked for the pay TV group Sky.

Alfalasi sent Clarke a ticket for an overnight flight from Heathrow to Dubai, returning the same day. She had a text with the photo of a letter authorizing her to carry the cash for a company Alfalasi owned, lending a false sense of legitimacy to the job.

After Clarke landed, Alfalasi guided her in texts and voice messages to report the cash at an airport office, and said he was waiting outside. She flew three more times in February 2020 and Alfalasi enlisted other couriers.

In July 2020, Clarke texted a friend, saying she needed 12 people to work. The job criteria: “Can’t talk, trust, and reliable and fit!!!” A friend put Clarke in touch with Larvin, saying that Clarke worked for the U.A.E. embassy.
The women met over a coffee. Clarke’s teenage son sat at a nearby table. Clarke showed Larvin stamped certificates she would carry as a document courier and offered £3,000, around $3,750, to fly the suitcases. Clarke also would pay for Larkin to stay at a resort until she returned home with the empty bags.

Larvin had worked in digital marketing and done some modeling and wildlife photography. She had acted in a chart-topping British band’s music video in 2008. Her 2009 breakup with her world-champion boxer boyfriend, Joe Calzaghe, made the British tabloids after he started dating his partner on the TV show “Strictly Come Dancing.”

The following month, Larvin sent Clarke a photo of her passport and traveled by train to London’s King’s Cross station, on her way to Heathrow Airport. Her heart rate was going up, she texted her new boyfriend, Jonathan Johnson, an executive recruiter.

“Please be careful,” he wrote. “I’m beside myself here.”

Larvin headed to a Starbucks in an expensive shopping district and met her traveling companion, a 25-year-old woman from a town outside London. A driver picked them up in a black Mercedes and drove to an address nearby to collect the suitcases.

At the airport, they went to Emirates Airline and put the seven suitcases on the conveyor belt. The luggage entered the mouth of a 3-D scanner that uses computed tomography, or CT, to find explosives. These images, unlike at passenger security, aren’t watched by people unless the software identifies an item that might set fire or explode. The machines can be programmed to find cash, but they aren’t because they are operated by airport-security agents, responsible for passenger safety, not customs and immigration officials.

Larvin and her travel companion settled into their business-class seats, and baggage handlers stowed their suitcases below them in the hold. The trip, there and back, went without a hitch.
In October 2020, two other women weren’t so lucky. They were questioned at a Heathrow departure gate by officers of the Border Force, the agency in charge of U.K. customs and immigration. One of the women told officers she checked five suitcases to Dubai because she wasn’t sure what to wear.

“Omg shel. We’ve been held,” the woman texted Clarke, who was in Dubai. “Wtf.”

The suitcases were unloaded from the plane. They contained nearly £2 million in cash, around $2.4 million. They also had videos of bundled notes being dumped from shopping bags for repacking. Investigators suspect that the timestamped videos were intended as proof of cash transfers for money-laundering clients. Authorities identified a woman in the videos as another member of the smuggling group from a tattoo on her forearm.

Investigators searched the phone of one of the women and from that information began piecing together how Alfalasi’s money-laundering operation grew to 36 international couriers.

In December 2020, Clarke was arrested with around $9 million worth of gold on a private plane in Zanzibar, off the coast of Tanzania, said Truby, the senior investigating officer in the case.

U.K. authorities arrested eight more alleged couriers in May 2021. Seven months later, Alfalasi unexpectedly visited London with his wife and children, staying at an apartment owned by his wife’s family on an exclusive Belgravia square.

One day around lunchtime, government investigators knocked on Alfalasi’s door. They seized three phones that revealed details of his operation, which later surfaced in court documents.