The Plague of Human Trafficking and Financial Red Flags (Part I of II) | The Volkov Legal Group


[author: Elizabeth Slim]

Elizabeth Slim, Senior Consultant at the Volkov Law Group, joins us for a two-part article on the problem of human trafficking and recent guidance issued by FinCEN.

Human trafficking has become one of the most lucrative forms of international crime. With around $150 billion worldwide per year, it ranks third behind drug trafficking and counterfeit goods. There are an estimated 40.3 million victims of modern slavery worldwide today, and profits are estimated to range from $13,000 for a forced laborer to $100,000 or more per year per trafficking victim. sexual.

A person is enslaved when they are treated as if they belong to another person. Although slavery is highly illegal under federal and international law, it continues to occur globally due to the high profits of criminal organizations. What is now clear is that government and law enforcement cannot fight human trafficking and slavery alone. They must increasingly rely on the private sector to join forces in the fight against these inhumane practices.

Modern human trafficking and slavery practices encompass a variety of disturbing criminal behaviors including kidnapping, assault, fraud, forced labor, debt bondage, servitude, and forced marriage. Perpetrators often hide vast schemes in plain sight in a range of common business contexts, such as hospitality, agriculture, janitorial services, construction, transportation, restaurants, domestic work, services salon or massage, fairs or carnivals and digital social media platforms.

The United Nations Convention against Transnational Organized Crime, also known as the “Palermo Protocol”, defines trafficking in human beings as “the recruitment, transportation, transfer, harboring or receipt of persons by the threat or the use of force or other forms of coercion, kidnapping, fraud, deception, abuse of power of a position of vulnerability or giving or receiving payments or benefits to obtain the consent of a person having authority over another person, for the purpose of exploitation. Exploitation includes, for example, the exploitation of persons for purposes of prostitution or sexual favors, forced labor or practices similar to slavery, or the removal of organs.

Numerous examples of trafficking operations have sparked public outrage in recent years. The case of Jeffrey Epstein, for example, drew attention to human trafficking in America, as his underage victims claimed they were coerced into performing sexual acts. Epstein was facing two trafficking charges at the time of his death: (1) sex trafficking of minors and (2) conspiracy to engage in sex trafficking of minors.

In 2016, a jury found a Stockton, California couple guilty of forcing their foreign-born housekeepers to work 18-hour days without pay and minimal food by creating “an atmosphere of fear through physical and verbal violence. Satish Kartan and his wife, Sharmistha Barai, were convicted of one count of conspiracy to commit forced labor and two counts of forced labor. The couple advertised $2,000-a-month jobs on an India-based newspaper website to attract people from abroad who were looking for domestic work in the United States. The victim said Baria punched her in the mouth and said: . Don’t answer. At one point, the victim’s hand was forced against an open flame on the kitchen stove. Both men face maximum prison sentences of 40 years each.

Most recently, on September 29, 2020, Ian Charles Schenkel, Founder and Managing Director of Haliburton International Foods, was charged with engaging in underage prostitution. Schenkel, 59, was charged with six counts, including unlawful sexual acts with a 14-year-old minor.

“The Liechtenstein Initiative for a Financial Sector Commission on Modern Slavery and Human Trafficking” is an international commission launched in September 2018 for governments around the world to partner with the private sector in the fight against human trafficking human being. The Liechtenstein Initiative aims to foster public-private partnerships by placing the financial sector at the heart of global efforts to eradicate modern slavery and human trafficking practices. The Liechtenstein Initiative brought together a coalition of survivors of human trafficking and child slavery, commercial and retail banking executives, institutional investors and global regulators to produce a document known as the name of Lichenstein Initiative Master Plan Report. This report provides a framework for the financial and professional sectors to demonstrate their actions taken to accelerate the end of modern slavery and human trafficking. The report illustrates how allies in the fight against these tragic practices can mitigate and address the risks of slavery and trafficking through innovative preventative solutions.

As we have seen, the private sector must play an active role in the fight against human trafficking and slavery by detecting red flags and reporting suspicions to law enforcement. Banks can conduct financial investigations and freeze assets. The hospitality industry can train employees to recognize the red flags of sex trafficking and labor. Health care providers can learn to identify common signs of abuse. Commercial industries that transact with third parties can perform appropriate due diligence to know their customers and supply chains, especially in high-risk industries. Other useful resources available to the private sector for further information on human trafficking include: (1) The Polaris Project, a non-profit organization dedicated to developing laws and policies to to address long-term human trafficking issues (, and (2) Blue Campaign, a national campaign by the Department of Homeland Security aimed at educating the public, law enforcement and industry partners to recognize the signs of human trafficking (


Comments are closed.