Question: Correspondent Banking. Harold Macronic is a businessman in Zurich. He has three companies under his control. Select Gems (SJ) is a registered company in France run by his cousin Thomas. SJ was purchased by Harold 10 years ago. Prior to the purchase, SJ had been in the wholesale jewelry business for 35 years. Moran Gold is a company run by Richard Macronic, Harold's brother, and it is registered in the Czech Republic. The company is inactive at the present time. The third company TDH, Inc., is a shell company in the Cayman Islands with Harold and Richard as the sole members of the board. SJ has had a correspondent account with Citibank in Los Angeles for 15 years. In the past, its sales to private customers in the L.A. area accounted for a substantial portion of its business. Cash and checks are directly deposited into the Citibank correspondent account in L.A. During the last 10 years, money deposited into the correspondent account has increased by 100 percent over in each fiveyear period. The money deposited in the account is transferred into bank accounts controlled by Moran Gold in the Czech Republic and by TDH, Inc. in the Cayman Islands.
Electronic fund transfers, not wire transfers, are used to move money out of the companies the bank accounts in the Czech Republic and the Cayman Islands to other locations. How could it be determined whether the cash transfers are the basis for a money laundering scheme?