Adverse Media Category

Aircraft Hijacking

An aircraft hijacking incident involves an individual or a group (including accomplices) that unlawfully

attempts, commits, or conspires to seize, takeover, or exercise control of an in-transit, government or

commercial common-carrier aircraft with wrongful intent or by force, violence, threat of force or

violence, or any form of intimidation. Aircraft hijacking incidents can include acts in connection with

or in furtherance of terrorism, terrorism financing, money laundering, organized crime, political

asylum, hostage taking, or political or administrative concession by authorities.

Excluded Incidents

• Private aircraft theft

• Truck hijacking

• Carjacking

• Maritime piracy

Antitrust violations

An antitrust violation incident involves an entity that attempts, conspires, or commits violations to

acts or laws that are intended to promote fair competition that protects commerce and trade from

abusive business practices. These incidents include national regulatory agencies or law enforcement

agencies with jurisdictional claims over both domestic and foreign conduct and domestic and foreign

parties. Abusive business practices can include the following examples:

• Unfair competition (such as mergers,

acquisitions, or takeovers of one firm by

another if the effect will substantially lessen

competition)

• Restraint of trade

• Monopolies

• Price-fixing

• Price discrimination

• Market-dividing

• Interlocking directorates (an individual who

makes business decisions for competing

companies)

• Bid-rigging

Excluded Incidents

• Private antitrust actions

• Natural persons who are associated with the subject entity, unless they are specifically

accused or charged with wrongdoing

• Private anti-trust actions

• Antitrust disputes brought to the World Trade Organization

Arms Trafficking

An arms trafficking incident involves an individual or a group that attempts, commits, or conspires to

divert contraband weapons, munitions, or explosives from lawful commerce into the illegal market

by way of direct purchase, trade, dealing, or smuggling in contravention of international laws and

regulations, the prescribed laws of the subject legal jurisdiction, or in violation of any extraterritorial

laws to which the entity is subject. These efforts can include acts in furtherance of political

destabilization, terrorism, civil war, regional conflicts, extra-judicial paramilitary activity, organized

crime, or in connection with other related AML predicate offenses that demonstrate an elevated risk

of abuse of the financial system.

Excluded Incidents

• Illegal or unauthorized weapons possession

• Incidents that lack evidence of an organized pattern of abuse, conspiracy, or financial motive

(for example, a single instance of an illicit gun sale through a straw purchaser)

Bank Fraud

A bank fraud incident involves an individual or a group that knowingly attempts, commits, or

conspires to execute an organized and systemic plan, scheme, or con to defraud a financial

institution or to obtain any of the moneys, funds, credits, assets, securities, or other property that is

owned by, or under the custody or control of, a financial institution by means of false or fraudulent

pretences, representations, or promises.

Excluded Incidents

• NSF (non-sufficient funds)

• Bank fraud that does not demonstrate an organized and systemic attempt to defraud a

financial institution

Bribery

A bribery incident involves an individual or a group that attempts, commits, or conspires to offer,

give, receive, or solicit currency or something of value to a national or foreign government official, a

private individual, or a person in charge of a public, legal, or fiduciary duty to influence or directly

alter the person's or group's actions for the following purposes:

• Disobey or avoid complying with international or national laws and regulations or local or

extraterritorial laws to which the entity may be subject.

• Encourage an entity to perform a service to which the payer is entitled even without the

payment, also known as facilitation payments or grease payments.

Included Incidents

• Participation in, or association with, the conspiracy to commit, attempt to commit, aid and

abet, facilitate, or counsel the commission of the event

• United Kingdom: facilitation payments

Excluded Incidents

• The private demonstration of good will

• Campaign donations from corporations or individuals to political candidates (the relationship

does not occur directly enough) consistent with the approved activity within the subject

jurisdictions

• The customary giving and receiving of gifts of limited monetary value as prescribed by law

• Circumstances where a payment, gift, offer, or promise of anything of value to a foreign

official may qualify as an affirmative defence

• A payment, gift, offer, or promise of anything of value that is lawful under the written laws

and regulations of the foreign official’s, political party’s, party official’s, or candidate’s country

• A payment, gift, offer, or promise of anything of value that is a reasonable and legal

expenditure

• Events that are consistent with approved activity within the subject jurisdictions

These events can include the customary giving and receiving of gifts of limited monetary value

as prescribed by law.

• A payment, gift, offer, or promise of anything of value that is directly related to the

promotion, demonstration, or explanation of products or services or that are directly related

to the execution or performance of a contract with a foreign government or agency (for

example, travel and lodging expenses)

• Conduct that is considered a routine “governmental action” exception by the FCPA (Foreign

Corrupt Practices Act)

Routine governmental actions include the following actions that are ordinarily and commonly

performed by a foreign official:

• Obtain permits, licenses, or other official documents to qualify a person to do business in

a foreign country.

• Process governmental papers such as visas or work orders.

• Provide police protection.

• Provide mail pick-up and delivery.

• Schedule inspections that are associated with contract performance or inspections that

are related to the transit of goods across the country.

• Provide telephone service.

• Provide power and water supply.

• Load and unload cargo.

• Protect perishable products or commodities from deterioration.

Burglary

A burglary incident involves an individual or a group that attempts, commits, or conspires to

unlawfully enter a structure with the intent to commit a crime to further terrorism, terrorism

financing, illicit flows in the financial system, money laundering, organized crime, corruption, hostage

taking, or other related AML predicate offenses.

Excluded Incidents

Burglaries that are not part of an organized or systemic plan or scheme that are unlikely to involve

the illicit flow or transfer of funds through the financial system

Conspiracy

A conspiracy incident involves an agreement, plan, or scheme between two or more people that is

formed for the purpose of committing, by their joint efforts, an unlawful or criminal act in

connection with, or in furtherance of, terrorism, terrorism financing, money laundering, organized

crime, political or administrative concession by authorities, or other related AML predicate offenses.

Excluded Incidents

Conspiracies that are not in furtherance of a predicate offense or that are unlikely to involve the

illicit flow or transfer of funds through the financial system

Corruption

A corruption incident involves a public official, a private citizen, or a fiduciary that attempts,

conspires, or commits an illegal or wrongful act to facilitate an abuse of the powers and influence

that are afforded to their office or station to procure a financial benefit or other type of benefit for

themselves or for another person, so that both parties, or a single individual, can disobey or avoid

complying with international or national laws and regulations or local or extraterritorial laws to

which the entity may be subject.

There are many forms of corruption that may involve public-private or public-public relationships.

The following types of corruption are a few examples:

• Grand corruption is the act by a group or an individual at the highest levels of government that

alter, misrepresent, or distort policies or the central functioning of the state or that require

significant erosion of the legal, political, and economic systems to enable leaders to benefit at

the expense of the public good.

• Petty corruption is the abuse of power that involves the exchange of very small amounts of

money or the granting minor favours for preferential treatment.

Excluded Incidents

Events that are consistent with the approved activity within the subject jurisdictions

These events can include the customary giving and receiving of gifts of limited monetary value as

prescribed by law.

Counterfeiting

A counterfeiting incident involves an individual or a group that attempts, commits, or conspires to

copy, imitate, or alter an item to increase the value or to reproduce an item without authorization

with the intent to present or use the copy as the genuine or original item. An item can include the

following examples:

• Obligations and securities

• Currency

• Documents that are issued by government

agencies or international organizations

• Bonds

• Bids

• Contracts

• Proposals

• Public records

• Affidavits

• Federal court documents

• Seals of government agencies or

international organizations

Excluded Incidents

Counterfeiting not in connection with or in furtherance of terrorism, terrorist financing, money

laundering, organized crime, political or administrative concession by authorities, or other related

AML predicate offenses or that are unlikely to involve the illicit flow or transfer of funds through

the financial system

Crimes Against Humanity

A crime against humanity incident involves an individual or a group that knowingly attempts,

commits, or conspires to conduct or participate in a widespread or systematic attack against a civilian

population as directed by an organization, group, government, state military, or paramilitary. The

following acts are examples of crimes against humanity when acknowledged by an authoritative

institution such as a government, the UN (United Nations), or the EU (European Union):

• Apartheid involves acts that are committed in the context of an institutionalized regime or

systematic oppression and domination by one racial group over any another racial group or

groups and that are committed with the intention of maintaining that regime.

• The deportation or forcible transfer of a population is the forced displacement of persons by

expulsion or other coercive acts from the area in which they are lawfully present without

grounds that are permitted under national law.

• An enforced disappearance is the arrest, detention, or abduction of persons by, or with the

authorization or support of, a state or political organization and a refusal to acknowledge the

deprivation of freedom or provide information on the fate or whereabouts of those persons with

the intention of removing them from the protection of the law for a prolonged period of time.

• Enslavement is the exercise of any or all powers in the right of ownership to a person (for

example, human trafficking).

• Extermination is the intentional infliction of conditions of life that is calculated to bring about the

destruction of a population in whole or in part. Inflictions can include the deprivation of access

to food and medicine or the deprivation of reproductive capacities.

• Genocide involves acts that are designed and committed with the intent to bring about the

destruction of a group in whole or in part.

• Murder is the killing of another human being.

• Persecution involves acts against an identifiable group on political, racial, national, ethnic,

cultural, or religious or gender grounds.

• Sexual violence can include rape, sexual slavery, or any other form of sexual violence of

comparable gravity.

• Torture is the intentional infliction of severe mental or physical pain or suffering.

Cybercrime

A cybercrime incident involves an individual or a group that unlawfully attempts, commits, or

conspires to use the Internet, electronic communications networks, or information systems in an

organized and systemic manner as a tool to conduct fraudulent transactions, theft of data for

financial gain, prohibit transactions, or transmit the proceeds of fraud to financial institutions or to

others that are connected with the scheme in furtherance of terrorism, terrorism financing, money

laundering, organized crime, corruption, hostage taking, or other related AML predicate offenses.

Excluded Incidents

• Cybercrimes that are not likely to involve the illicit flow or transfer of funds through the

financial system or a heightened risk of abuse of the financial system

• Cybercrimes that involve software piracy for personal use

Drug Trafficking

A drug trafficking incident involves an individual or a group that attempts, commits, or conspires to

engage in organized and systemic illicit trade that involves the cultivation, manufacture, distribution,

sale, importation, exportation, or dispensation of substances which are subject to drug prohibition or

controlled distribution laws. These incidents can include acts in conjunction with or in furtherance of

political destabilization, terrorism, civil war, regional conflicts, extra-judicial paramilitary activity,

organized crime, or in connection with other related AML predicate offenses that demonstrate an

elevated risk of abuse of the financial system.

Excluded Incidents

• Mere possession of a substance subject to drug prohibition

• Funds that are transferred or activities in connection with medical marijuana or recreational

marijuana in jurisdictions which have authorized or decriminalized commercial commerce

• Incidents that lack evidence of an organized pattern of abuse, conspiracy, or material financial

motive

(for example, a single instance of a small quantity of drugs that fails to demonstrate evidence

of an organized scheme of “distribution for profit”)

• Incidents that are unlikely to involve the illicit flow or transfer of funds through the financial

system

Embezzlement

An embezzlement incident involves an individual or a group that attempts, commits, or conspires to

misappropriate personal or government financial assets from entities that have been lawfully

entrusted with the care of the assets or by the entrusted entities themselves (for example,

employee, clerk, agent, trustee, public officer, or other person that acts in a fiduciary character) to

covertly and fraudulently convert these assets for their own use or benefit or transfers the assets to

a third party for their own use and benefit.

Environmental Crimes

An environmental crime incident involves an individual or a group that attempts, commits, or

conspires to systemically and wilfully engage in illegal acts that directly harm the environment and

aim at benefiting individuals or groups or organizations from the exploitation of, damage to, or trade

or theft of natural resources. These acts are in contravention of international environmental laws and

regulations, the prescribed environmental laws of the subject legal jurisdiction, or in violation of any

extraterritorial laws to which the entity is subject with the wilful intent to secure material financial

advantage through profit or cost avoidance from the activity. These incidents can include the

following acts:

• Dumping industrial wastes into water bodies

• Illicit trading in hazardous waste

• Trafficking endangered species or government-protected environmental goods

• Smuggling of Ozone-depleting substances

• Illegal logging and trade of stolen timber in violation of the wildlife laws

Excluded Incidents

• Instances of neglect or instances that do not demonstrate a financial incentive

• Lacey Act violations

Espionage

An espionage incident involves an individual or a group that attempts, commits, or conspires to

secretly gather political, military, or economic information about a foreign or domestic government

or commercial enterprise for the purpose of placing one’s own government or corporation at some

strategic or financial advantage. This information includes trade secrets from a private enterprise.

Explosives

An explosives incident involves an individual or a group that attempts, commits, or conspires to

perpetrate an organized or systemic criminal act that involves explosives or other destructive devices

in connection with or in furtherance of terrorism, terrorism financing, money laundering, organized

crime, political asylum, hostage taking, political or administrative concession by authorities, or other

acts for financial gain. These acts can include possessing, importing, manufacturing, transferring,

transporting, or dealing in explosive materials without a license. A destructive device can include any

explosive, incendiary, or poison gas, bomb, grenade, rocket, mine, or missile.

Extort-Rack-Threats (Extortion, Racketeering, or Threats)

An extortion incident involves an individual or a group that attempts, commits, or conspires to obtain

money, property, or services from a person or institution in an organized and systemic manner

through a pattern of illegal activity that employs the wrongful use of physical or threatened force,

violence, fear, property damage, damage to the person’s reputation, extreme financial hardship, or

under cover of unfavourable government action. Extortion involves obtaining consent through these

illegal coercive actions that remove the victim's free will.

Financial Crimes

A financial crime incident involves an individual or a group that attempts, commits, or conspires to

unlawfully convert money or property with the intent to gain personal benefit. These incidents

include financial crimes that are not covered by another financial subcategory. The following

financial crimes are a few examples:

• White-collar crimes (for example, bankruptcy fraud, illicit payments)

• Systemic and organized financial crime

• Illegally obtaining banking information

• Trade secret fraud

• Structuring financial translations (also known as smurfing)

• Loan sharking or usury

• Skimming

• Financial crimes that are likely to involve the illicit flow or transfer of funds through the financial

system

• Financial crimes in conjunction with or in furtherance of money laundering, political

destabilization, terrorism, terrorist financing, civil war, regional conflicts, extra-judicial

paramilitary activity, organized crime, or in connection with other related AML predicate offenses

that demonstrate an elevated risk of abuse of the financial system

Forgery

A forgery incident involves an individual or a group that attempts, commits, or conspires to alter or

replicate an original document or write a false signature with the intent to defraud for the illegal

benefit of the person or persons who committed the forgery. Forgery must demonstrate an

organized and systemic scheme in connection with or in furtherance of terrorism, terrorism

financing, money laundering, organized crime, political asylum, political or administrative concession

by authorities, or other related AML predicate offenses with wilful purpose of financial gain. These

incidents can include the forgery of checks, stamps, or artwork.

Fraud

A fraud incident involves an individual or a group that operates in an organized and systemic manner

to intentionally or knowingly attempt, conspire, or commit to misrepresenting a material, existing

fact or deceiving an entity that relies on the misrepresentation in order to deprive the entity of its

money, property, or legal right. These incidents include fraud that is not covered by another

subcategory.

Excluded Incidents

Fraud for personal gain without financial involvement or that is unlikely to involve the illicit flow

or transfer of funds through the financial system

Fugitive

A fugitive incident involves a person who flees a jurisdiction or prison to avoid arrest, prosecution for

a crime, imprisonment, or to avoid giving testimony in any criminal proceeding.

Excluded Incidents

Fugitives whose alleged activity does not meet the prescribed definition of other risk categories in

the database

Gambling Operations

A gambling operation incident involves an individual or a group that attempts, commits, or conspires

to conduct, finance, manage, supervise, direct, or own all or part of an illegal, organized, gambling

business. This business may be done in furtherance of organized crime, terrorism financing, or other

related AML predicate offense. These gambling operations demonstrate an organized and systemic

approach that are likely to involve the illicit flow or transfer of funds through the financial system or

a heightened risk of abuse of the financial system. Gambling operations is also known as illegal

gaming.

Excluded Incidents

• Gambling operations that are not organized and systemic

• Gambling operations that are unlikely to involve the illicit flow or transfer of funds through

the financial system or a heightened risk of abuse of the financial system

Healthcare Fraud

A healthcare fraud incident involves an individual or a group that operates in an organized and

systemic matter that attempts, commits, or conspires to execute a scheme or a hoax to defraud any

healthcare benefit program or insurer or to obtain by means of false or fraudulent pretences,

representations, or promises any of the money or property owned by, or under the custody or

control of, any healthcare benefit program or insurer. The following practitioner schemes are a few

examples:

• Obtaining subsidized or fully covered prescription pills that are unneeded and then selling them

on the black market for a profit

• Billing by practitioners for care that they never rendered

• Filing duplicate claims for the same service rendered

• Altering the dates, description of services, or identities of members or providers

• Billing for a non-covered service as a covered service

• Modifying medical records

• Intentional incorrect reporting of diagnoses or procedures to maximize payment

• Accepting or giving illicit payments for member referrals

• Waiving member co-pays

• Prescribing additional or unnecessary treatment

• Providing false information when applying for programs or services

• Forging or selling prescription drugs

Excluded Incidents

• Healthcare fraud that does not demonstrate an organized and systemic approach

• Healthcare fraud that involves innocent misrepresentations

Human Rights Abuse

A human rights abuse incident involves an individual or a group that attempts, commits, or conspires

to violate basic human rights and freedoms that fundamentally and inherently belong to an

individual. Human rights are established by international agreement, convention, custom, or national

law acts when acknowledged by an authoritative institution. These institutions include government

agencies, the UN, the EU, non-governmental organizations that work in these areas, and credible

open-source media. These events can include acts in furtherance of political destabilization,

terrorism, civil war, regional conflicts, organized crime, or in connection with other related AML

predicate offenses that demonstrate an elevated risk of abuse of the financial system. The following

human rights are a few examples:

• The right to life

• The freedom from torture

• The right to a fair trial

• The right to freedom of assembly and association (for example, membership or formation of

political parties or trade unions)

• The freedom of religion, expression, security, and asylum

• The freedom from slavery or servitude

• The freedom from arbitrary arrest, detention, or exile

Human Trafficking

A human trafficking incident involves an individual or a group that attempts, commits, or conspires in

the recruitment, transportation, transfer, harbouring, or receipt of persons by means of the following

acts for the purpose of exploitation or commercial gain:

• Threat or use of force or other forms of coercion

• Abduction

• Deception

• Fraud

• Abuse of power or of a position of vulnerability

• Giving or receiving of payments or benefits to achieve the consent of a person who has control

over another person

Exploitation can include prostitution of others, other forms of sexual exploitations, forced labour

services, servitude, slavery or practices similar to slavery, or the removal of organs.

Insider Trading

An insider trading incident involves an individual or a group that attempts, commits, or conspires to

buy or sell a security while in possession of, or having access to, material, private, confidential, or

non-public information about the security in breach of a fiduciary duty or other relationship of trust

and confidence.

Insurance Fraud

An insurance fraud incident involves an individual or a group that attempts, commits, or conspires to

perform a duplicitous act in a systemic and organized scheme with the intent to obtain an improper

payment from an insurer. These incidents include the following fraud schemes:

• Hard fraud occurs with the deliberate destruction of property for the purpose of collecting on the

insurance policy.

• Soft fraud occurs when a policyholder exaggerates an otherwise legitimate claim or when an

individual applies for an insurance policy and lies about certain conditions or circumstances to

lower the policy’s premium.

ISIS Foreign Support

ISIS Foreign Support incidents include an individual or a business with a recognized affiliation with

ISIS (Islamic State in Iraq and Syria) or ISIS groups that provides material support to ISIS through

means that violate state anti-terrorism laws. The following actions are a few examples of material

support:

• Donating, soliciting, or providing financial resources to ISIS operations

• Facilitating material support in the form of military equipment, recruitment, illicit trade, and

smuggling

• Conducting attacks as a member of the organization

• Conducting attacks in the name of the organization even without material support (also known

as LWA or a lone wolf attack)

LWAs are defined as attacks or actions by individuals who are not officially connected to, or

acting on behalf of, a state-recognized terrorist organization. LWAs are not supported monetarily

or otherwise by ISIS. These individuals are inspired by these organizations and decided on their

own to act in the name of ISIS.

Foreign supporters are also defined as ISIS members who take the following actions:

• Carrying out or support attacks on their own countries in support of the Islamic State

• Providing means of support, such as, voice overs on ISIS-produced videos, video technical

support, managing content on ISIS-owned websites, or procurement of resources and services

for the benefit of ISIS groups

Kidnapping

A kidnapping incident involves an individual or a group that attempts, commits, or conspires to

unlawfully seize and carry away a person against their will, by force or fraud, with the intent to hold

for ransom or reward, use as a hostage, accomplish or aid in the commission of a felony or flight

from a felony, inflict physical harm, violate or abuse sexually, terrorize, or interfere with the

performance of any governmental or political function. Kidnapping is also known as abduction.

Excluded Incidents

• Parental kidnapping

• Kidnapping that does not demonstrate a financial motive or an organized and systemic

approach

• Kidnapping that is not in furtherance of terrorism, terrorism financing, money laundering,

organized crime, hostage taking (ransom), political or administrative concession by

authorities, or other related AML predicate offenses

Labour Violations

A labour violation incident involves an individual or a group that attempts, commits, or conspires to

violate labour laws that define the rights of employees and protect them from employer retaliation for

exercising those legal rights or reporting violations to the proper authorities.

These violations can include the following acts:

• Interfering or restraining employees in the exercise of their rights

• Dominating or interfering with the formation or administration of any labour organization

• Discriminating in regards to the hiring or tenure of employment

• Encouraging or discouraging membership in a labour organization

• Refusing to collectively bargain with the representatives of employees

• Violating child labour laws

• Violating labour laws in a way that demonstrates a wilful intent to secure material financial

advantage

• Violating labour laws in a way that likely involves the illicit flow or transfer of funds through the

financial system or a heightened risk of abuse of the financial system

Excluded Incidents

• Labour violations that are unlikely to involve the illicit flow or transfer of funds through the

financial system

• Civil claims of labour violations

Money Laundering

A money laundering incident involves an individual or a group that attempts, commits, or conspires

to engage in any act or scheme that aims to conceal or disguise the identity, source, and destination

(also known as placement, layering, and integration) of illegally obtained proceeds so that they

appear to have originated from legitimate or legal sources.

Mortgage Fraud

A mortgage fraud incident involves an individual or a group that operates in an organized and

systemic manner that intentionally and knowingly provides any material misstatement,

misrepresentation, or omission of information that an underwriter or lender must use to fund,

purchase, or insure a loan. The following types of fraud are a few examples:

• Fraud for profit involves an organized, systemic, and elaborate scheme that usually involves

collusion among many persons such as a mortgage broker or loan processor and that is

committed through single or multiple loans or transactions to gain illicit proceeds from property

sales. Fraud for profit is also known as industry insider fraud.

• Fraud for criminal enterprise involves the purchase of real estate with illegally obtained funds

(for example, drug activity) in order to clean or “launder” the money so that the money appears

to be obtained by legal means.

• Fraud for property involves deliberate misrepresentations of income, assets, or debt to obtain a

mortgage or more favourable terms for the purpose of purchasing a property for primary

residence. Fraud for property is also known as fraud for housing.

Murder

A murder incident involves an individual or a group that attempts, commits, or conspires to

unlawfully kill a natural person with intent, malice aforethought, and with no legal authority or

excuse in furtherance of terrorism, terrorism financing, money laundering, organized crime, political

asylum, hostage taking, political or administrative concession by authorities, or other related AML

predicate offenses.

Excluded Incidents

• Crimes of passion

• Murder that is not in connection with or in furtherance of money laundering, terrorism,

terrorist financing, money laundering, organized crime, hostage taking, political or

administrative concession by authorities, or other related AML predicate offenses

• Murder that does not demonstrate an organized and systemic approach

Organized Crime

An organized crime incident involves a group of three or more persons that act in concert within a

formalized structure and that attempt, commit, or conspire to engage in long-term criminal activities

in a systematic manner to obtain, directly or indirectly, a financial or other material benefit through

illegal activities in one or more illegal economic sectors in one or more jurisdictions.

Included Incidents

• Organized crime that demonstrates a planned, systematic nature of criminal activity that

range from national to international in scale

• Organized crime that is likely to involve the illicit flow or transfer of funds through the

financial system or demonstrate a heightened risk of abuse of the financial system

• Organized crime in connection with or in furtherance of terrorism, terrorist financing, money

laundering, hostage taking, political or administrative concession by authorities, or other

related AML predicate offenses

Excluded Incidents

• Organized crime that is unlikely to involve the illicit flow or transfer of funds through the

financial system

• Organized crime that is politically motivated terrorism, rather than profit driven

• Organized crime that does not demonstrate a heightened risk of abuse of the financial system

Peonage

A peonage incident involves an individual or a group that attempts, commits, or conspires to enforce

servitude upon an individual against their will by restraining their liberty (freedom from restraint is

the ability to decide for one's self, or free will) and compelling them to labour in payment of a debt or

obligation (real or pretended). Peonage is also known as debt servitude or debt slavery.

Pharma Trafficking (Pharmaceutical Products Trafficking)

An incident of pharmaceutical products trafficking involves an individual or a group that attempts,

commits, or conspires to engage in the manufacture, trade, transport, and distribution of fake,

stolen, or illicit medicines and medical devices in an organized and systemic manner in contravention

of international laws and regulations, the prescribed laws of the subject legal jurisdiction, or in

violation of any extraterritorial laws to which the entity is subject.

Excluded Incidents

• A single instance of selling pharmaceutical products

• Small-scale prescription drug sales

Piracy

A piracy incident involves an individual or a group that attempts, commits, or conspires to engage in

any criminal act of violence, detention, or depredation. These acts are perpetrated by the crew or

the passengers of a private ship or aircraft that is directed on the high seas, against another ship,

aircraft, or against persons or property committed for private benefit. These acts include incidents

that are outside a state’s sovereign maritime borders, and are applicable under universal jurisdiction

where states or international organizations can claim criminal jurisdiction of an accused person or

group regardless of where the alleged crime was committed.

Included Incidents

• Maritime piracy in international waters

• Piracy incidents that involve vessels at sea or on a river

Pollution

A pollution incident involves an individual or a group that attempts, commits, or conspires in an

organized and systemic manner to wrongfully contaminate the atmosphere, soil, or water with

harmful or potentially harmful substances to secure a material financial advantage through profit or

cost avoidance that are likely to have an adverse effect on the natural environment or life. Pollution

incidents also include incidents with the wilful intent to secure material financial advantage through

profit or cost avoidance from the activity or are determined by the courts to be criminally negligent

acts.

Pornography

A pornography incident involves an individual or a group that attempts, commits, or conspires to

engage in the organized and systemic and unlawful production, sale, or distribution of scenes

(represented through books, magazines, photographs, films, or other media) of sexual behaviour that

is designed to arouse sexual interest in contravention of international laws and regulations or in

violation of any extraterritorial laws to which the entity is subject, specifically as they relate to

incidents in connection with or in furtherance of child endangerment, human trafficking, bribery, or

other related AML predicate offense.

Price Manipulation

A price manipulation incident involves an individual or a group that attempts, commits, or conspires

to deliberately attempt to interfere with the free and fair operation of the legitimate economy and

financial system to create a misleading price or market for currencies, commodities, or securities

with the intent of securing a financial or other material benefit for themselves or others in one or

one or more jurisdictions.

RICO (Racketeer Influenced and Corrupt Organizations)

A RICO incident involves an individual or a group that attempts, commits, or conspires to violate the

RICO Act by engaging in a pattern of wrongdoing (for example, racketeering or AML predicate

offenses) as a member of a criminal enterprise or organization. Although this law is specific to the

United States, W2 recognizes international equivalent violations in contravention of

international laws and regulations or in violation of any extraterritorial laws to which the entity is

subject.

Securities Fraud

A securities fraud incident involves an individual or a group that attempts, commits, or conspires to

defraud, deceive, or induce investors in an organized and systemic manner to make a purchase or a

sale decision based on misrepresenting information, providing false information, withholding key

information, intentionally offering bad advice, or offering or acting on inside information. The

following types of securities fraud are a few examples:

• Manipulating stock prices

• Insider trading of securities

• Falsifying required regulatory reporting to authorities

• Falsifying accounting reports

• Third-party misrepresentation

Smuggling

A smuggling incident involves an individual or a group that acts in an organized and systemic manner

and that attempts, commits, or conspires to knowingly, wilfully, and intentionally bring items into, or

remove items from, a country or to facilitate the transportation, concealment, or sale of such items

after importation to avoid taxation, obtain goods that are prohibited by a certain region, or for

material, financial gain.

Excluded Incidents

• Smuggling incidents such as an individual who smuggles a prohibited object as a souvenir

when returning from a trip

• Smuggling incidents that lack a clear pattern of abuse or material financial motive

Stolen Property

A stolen property incident involves an individual or a group that attempts, commits, or conspires to

receive, hold or possess, transport, distribute, or sell goods, in an organized and systemic manner,

with the knowledge that they have been acquired by theft, larceny, robbery, or other unlawful

means.

Included Incidents

Stolen property incidents that involve the systemic and organized possession, receipt, transport

distribution, or sale of stolen property

These incidents are limited to incidents of stolen property with clear evidence of financial gain

with an alleged risk of the illicit flow or transfer of funds through the financial system.

Excluded Incidents

• Minor thefts by an individual

• Incidents where an entity did not know or could not have reasonably known that the goods

were stolen

Tax Evasion

A tax evasion incident involves an individual or a group that attempts, commits, or conspires to

engage in a systemic and organized scheme to facilitate the intentional and fraudulent

underpayment or non-payment of taxes by deliberately withholding information or misrepresenting

or concealing the nature of financial affairs to the tax authorities to reduce or completely eliminate

tax liability.

Included Incidents

• Tax evasion that demonstrates an illegal scheme to avoid paying taxes

• Tax evasion that demonstrates a pattern of avoiding tax payments

• Tax evasion that demonstrates a risk of the illicit flow or transfer of funds through the

financial system or a heightened risk of abuse of the financial system

Excluded Incidents

Tax evasion that does not demonstrate an organized or systemic approach, such as a single

instance of failure to file a federal tax return

Terrorism

Terrorism, or more accurately political violence, is a complicated social and political phenomenon

and there is no single accepted definition. For example, in some countries, the law characterizes

terrorist acts that are carried out within the state as domestic extremism. Similarly, the motivations

for an individual’s or group’s violent acts may involve ideological, separatist, ethnic, religious, or

state-sponsored aims. W2 recognizes the complexity of identifying terrorist activities and the

individuals or groups that perpetrate these acts. W2 uses the following core criteria to identify

terrorist acts:

• The use of physical or coercive violence

• The use of these acts is to install fear

• The use of these means to effect government or international organization policies or actions

that further certain political or social causes

• The acts are perpetrated by individuals or organized groups

W2 uses the following core criteria to identify the groups that are involved in terrorist acts:

• The group is recognized by a government or international organization.

• The group attempts, commits, or conspires to engage in the unlawful use of physical violence or

the threat of violence (coercion) or intimidation.

• The group's actions involve acts that dangerous to human life against civilian persons,

government officials, or the destruction of property.

• The group acts within a single country or across sovereign borders and territories.

• The group acts to influence or affect the policies or actions of government or international

organization or populations.

• The group acts in the furtherance of certain political or social objectives.

W2 uses the following core criteria to identify the individuals who are involved in terrorist

acts:

• The individual is a known member of a group that has been recognized by a government or

international organization.

• The individual's group has publicly claimed the individual to be associated with the organization

and acting on its behalf.

• The individual's group attempts and conspires to engage in the unlawful use of physical violence

or the threat of violence (coercion) or intimidation.

• The individual's group's actions involve acts that are dangerous to human life against civilian

persons, government officials, or the destruction of property.

• The individual's group acts within a single country or across sovereign borders and territories.

• The individual's group acts to influence or affect the policies or actions of governments or

international organizations or population.

• The individual's group acts in the furtherance of certain political or social objectives.

Included Incidents

W2 recognizes that seriousness of LWAs (lone wolf attack), which are attacks or actions by

individuals who are not officially connected to, or acting on behalf of, a state-recognized terrorist

organization. These individuals are not supported materially, monetarily, or otherwise by a

recognized terrorist organization, but they are inspired by the terrorist group's ideology or aims.

These individuals decide on their own to act in the organization’s name.

Terrorism acts include acts that are perpetrated within the United States that are legally classified

as domestic extremism, which include an individual who acts alone or with accomplices according

to the above criteria and who may not hold an affiliation with a foreign terrorist group.

Excluded Incidents

• Incidents that do not include a political or social motivation and that do not intend to affect

the policies or actions of government or international organizations

• Incidents that are motivated by domestic violence or personal grudges or vendettas

War Crimes

A war crime incident involves an individual or a group that has been indicted, wanted, accused, or

charged by a national government or international organization or judiciary body and that attempts,

commits, or conspires to violate the laws, treaties, customs, or practices that govern military or

armed conflict between international and non-international states or parties. War crimes may be

committed by government armed forces, irregular armed forces (guerrillas and insurgents), military

and political leaders, members of the judiciary, or industrialists. The following war crimes are a few

examples:

• Atrocities or offenses against person or property

• Murder, ill treatment, or deportation to slave labour of a civilian population in an occupied

territory

• Murder or ill treatments of prisoners of war or persons on the seas

• Killing of hostages

• Biological experiments

• Plunder

• Wanton destruction of cities, towns, or villages

• Devastation that is not justified by military necessity

Wire Fraud

A wire fraud incident involves an individual or a group that attempts, commits, or conspires to

engage in a systemic and organized scheme that uses communications (for example, postal mail,

telephone calls, fax machines, television, wire, or radio) to obtain money or property by means of

false or fraudulent pretences, representations, promises, or transmissions for the purpose of

financial gain.

Included Incidents

Mail fraud

WMD (Weapons of Mass Destruction)

A weapons of mass destruction incident involves an individual or a group that attempts, commits, or

conspires to unlawfully manufacture, possess, sell, deliver, display, use, threaten to use, or make

readily accessible to others CBRN (chemical, biological, radiological, or nuclear) weapons or high

explosives that are capable of a high order of destruction or of being used in such a manner as to

destroy large numbers of people, cause death or serious physical harm to a large number of humans,

or cause mass destruction to human-made structures (for example, buildings), natural structures (for

example, mountains), or the biosphere. WMDs are also known as ABC (atomic, biological, or

chemical) weapons.

Associated Entity Category

The profiles in the Associated Entity category are linked to at least one sanctioned entity. Associated

entities are referred to or implied in sanctions sources, but are not explicitly named as sanctioned

entities in those sources.

The Associated Entity category includes the following types of entities:

• Family members or associates of sanctioned entities

The name of a family member or associate is sometimes provided in a sanctions source within the

background information for a sanctioned entity. When the family member or associate is not

sanctioned in their own right, W2 applies the Associated Entity category to the entity and

links that entity to the sanctioned entity. The nature of the associated entity’s relationship to the

sanctioned entity is described in the Positions field. For example, “Father of Sanctioned Entity.”

Such entities are not only individuals; they may also be organizations or other types of entities.

W2 may also apply the Associate subcategory to these profiles.

• Branches and operational units of sanctioned banks

Sometimes sanctions sources state that the sanction of an institution applies to certain branches, or

all branches worldwide, without including the details of the branch name, the address, and the BIC

(Bank Identifier Code). To help clients screen this information, W2 creates a profile for each

sanctioned branch and operational unit under the Associated Entity category, using data that is

sourced from SWIFT (Society for Worldwide Interbank Financial Telecommunication). W2

applies the SWIFT BIC Entity subcategory to these profiles.

• Entities that are owned or controlled by sanctioned entities

OFAC (Office of Foreign Assets Control), the EU, and HMT (Her Majesty’s Treasury in the United

Kingdom) stipulate that entities owned or controlled by subjects that are named in certain sanctions

they administer should also be considered as sanctioned, without going so far as to name the owned

or controlled entities. W2 helps clients screen for this potential sanctions risk by including

entities that are found in open source research to be owned or controlled by the relevant sanctioned

entities. W2 applies the Ownership Or Control subcategory to these profiles, as well as a

unique source that indicates the OFAC, EU, or HMT sanctions source of the sanctioned entity that

prompted its inclusion. In addition, each profile is linked through a relationship to the “parent”

sanctioned entity.

Enforcement Category

Administrative

An administrative incident involves a communication by a regulatory authority against an individual

or entity as a result of misconduct, legal violations, or fiduciary duty breaches. These violations

resulted in an investigation, warning, or notice that does not include a fine or carry a temporary

prohibition or permanent prohibition to conduct business or fulfil the duties of office. These

violations include warnings for late filings or disclosures of financial information to regulatory bodies.

Aircraft Hijacking

An aircraft hijacking incident involves an individual or a group (including accomplices) that unlawfully

attempts, commits, or conspires to seize, takeover, or exercise control of an in-transit, government or

commercial common-carrier aircraft with wrongful intent or by force, violence, threat of force or

violence, or any form of intimidation. Aircraft hijacking incidents can include acts in connection with

or in furtherance of terrorism, terrorism financing, money laundering, organized crime, political

asylum, hostage taking, or political or administrative concession by authorities.

Excluded Incidents

• Private aircraft theft

• Truck hijacking

• Carjacking

• Maritime piracy

Antitrust violations (Antitrust Violations)

An antitrust violation incident involves an entity that attempts, conspires, or commits violations to

acts or laws that are intended to promote fair competition that protects commerce and trade from

abusive business practices. These incidents include national regulatory agencies or law enforcement

agencies with jurisdictional claims over both domestic and foreign conduct and domestic and foreign

parties. Abusive business practices can include the following examples:

• Unfair competition (such as mergers,

acquisitions, or takeovers of one firm by

another if the effect will substantially lessen

competition)

• Restraint of trade

• Monopolies

• Price-fixing

• Price discrimination

• Market-dividing

• Interlocking directorates (an individual who

makes business decisions for competing

companies)

• Bid-rigging

Excluded Incidents

• Private antitrust actions

• Natural persons who are associated with the subject entity, unless they are specifically

accused or charged with wrongdoing

• Private anti-trust actions

• Antitrust disputes brought to the World Trade Organization

Arms Trafficking

An arms trafficking incident involves an individual or a group that attempts, commits, or conspires to

divert contraband weapons, munitions, or explosives from lawful commerce into the illegal market

by way of direct purchase, trade, dealing, or smuggling in contravention of international laws and

regulations, the prescribed laws of the subject legal jurisdiction, or in violation of any extraterritorial

laws to which the entity is subject. These efforts can include acts in furtherance of political

destabilization, terrorism, civil war, regional conflicts, extra-judicial paramilitary activity, organized

crime, or in connection with other related AML predicate offenses that demonstrate an elevated risk

of abuse of the financial system.

Excluded Incidents

• Illegal or unauthorized weapons possession

• Incidents that lack evidence of an organized pattern of abuse, conspiracy, or financial motive

(for example, a single instance of an illicit gun sale through a straw purchaser)

Asset Freeze

An asset freeze incident involves a government or court action that restricts, suppresses, or

confiscates an entity's financial assets, funds, economic resources, or non-financial assets to ensure

that these funds are not made available, directly or indirectly, for the entity’s benefit, by persons that

act on their behalf, or at their direction within or outside of the issuing authority's jurisdiction. Asset

freezes are frequently included in “smart sanctions” or “targeted sanctions” strategies.

Bank Fraud

A bank fraud incident involves an individual or a group that knowingly attempts, commits, or

conspires to execute an organized and systemic plan, scheme, or con to defraud a financial

institution or to obtain any of the moneys, funds, credits, assets, securities, or other property that is

owned by, or under the custody or control of, a financial institution by means of false or fraudulent

pretences, representations, or promises.

Excluded Incidents

• NSF (non-sufficient funds)

• Bank fraud that does not demonstrate an organized and systemic attempt to defraud a

financial institution

Bribery

A bribery incident involves an individual or a group that attempts, commits, or conspires to offer,

give, receive, or solicit currency or something of value to a national or foreign government official, a

private individual, or a person in charge of a public, legal, or fiduciary duty to influence or directly

alter the person's or group's actions for the following purposes:

• Disobey or avoid complying with international or national laws and regulations or local or

extraterritorial laws to which the entity may be subject.

• Encourage an entity to perform a service to which the payer is entitled even without the

payment, also known as facilitation payments or grease payments.

Included Incidents

• Participation in, or association with, the conspiracy to commit, attempt to commit, aid and

abet, facilitate, or counsel the commission of the event

• United Kingdom: facilitation payments

Excluded Incidents

• The private demonstration of good will

• Campaign donations from corporations or individuals to political candidates (the relationship

does not occur directly enough) consistent with the approved activity within the subject

jurisdictions

• The customary giving and receiving of gifts of limited monetary value as prescribed by law

• Circumstances where a payment, gift, offer, or promise of anything of value to a foreign

official may qualify as an affirmative defence

• A payment, gift, offer, or promise of anything of value that is lawful under the written laws

and regulations of the foreign official’s, political party’s, party official’s, or candidate’s country

• A payment, gift, offer, or promise of anything of value that is a reasonable and legal

expenditure

• Events that are consistent with approved activity within the subject jurisdictions

These events can include the customary giving and receiving of gifts of limited monetary value

as prescribed by law.

• A payment, gift, offer, or promise of anything of value that is directly related to the

promotion, demonstration, or explanation of products or services or that are directly related

to the execution or performance of a contract with a foreign government or agency (for

example, travel and lodging expenses)

• Conduct that is considered a routine “governmental action” exception by the FCPA

Routine governmental actions include the following actions that are ordinarily and commonly

performed by a foreign official:

• Obtain permits, licenses, or other official documents to qualify a person to do business in

a foreign country.

• Process governmental papers such as visas or work orders.

• Provide police protection.

• Provide mail pick-up and delivery.

• Schedule inspections that are associated with contract performance or inspections that

are related to the transit of goods across the country.

• Provide telephone service.

• Provide power and water supply.

• Load and unload cargo.

• Protect perishable products or commodities from deterioration.

Burglary

A burglary incident involves an individual or a group that attempts, commits, or conspires to

unlawfully enter a structure with the intent to commit a crime to further terrorism, terrorism

financing, illicit flows in the financial system, money laundering, organized crime, corruption, hostage

taking, or other related AML predicate offenses.

Excluded Incidents

Burglaries that are not part of an organized or systemic plan or scheme that are unlikely to involve

the illicit flow or transfer of funds through the financial system

Conspiracy

A conspiracy incident involves an agreement, plan, or scheme between two or more people that is

formed for the purpose of committing, by their joint efforts, an unlawful or criminal act in

connection with, or in furtherance of, terrorism, terrorism financing, money laundering, organized

crime, political or administrative concession by authorities, or other related AML predicate offenses.

Excluded Incidents

Conspiracies that are not in furtherance of a predicate offense or that are unlikely to involve the

illicit flow or transfer of funds through the financial system

Corruption

A corruption incident involves a public official, a private citizen, or a fiduciary that attempts,

conspires, or commits an illegal or wrongful act to facilitate an abuse of the powers and influence

that are afforded to their office or station to procure a financial benefit or other type of benefit for

themselves or for another person, so that both parties, or a single individual, can disobey or avoid

complying with international or national laws and regulations or local or extraterritorial laws to

which the entity may be subject.

There are many forms of corruption that may involve public-private or public-public relationships.

The following types of corruption are a few examples:

• Grand corruption is the act by a group or an individual at the highest levels of government that

alter, misrepresent, or distort policies or the central functioning of the state or that require

significant erosion of the legal, political, and economic systems to enable leaders to benefit at

the expense of the public good.

• Petty corruption is the abuse of power that involves the exchange of very small amounts of

money or the granting minor favours for preferential treatment.

Excluded Incidents

Events that are consistent with the approved activity within the subject jurisdictions

These events can include the customary giving and receiving of gifts of limited monetary value as

prescribed by law.

Counterfeiting

A counterfeiting incident involves an individual or a group that attempts, commits, or conspires to

copy, imitate, or alter an item to increase the value or to reproduce an item without authorization

with the intent to present or use the copy as the genuine or original item. An item can include the

following examples:

• Obligations and securities

• Currency

• Documents that are issued by government

agencies or international organizations

• Bonds

• Bids

• Contracts

• Proposals

• Public records

• Affidavits

• Federal court documents

• Seals of government agencies or

international organizations

Excluded Incidents

Counterfeiting not in connection with or in furtherance of terrorism, terrorist financing, money

laundering, organized crime, political or administrative concession by authorities, or other related

AML predicate offenses or that are unlikely to involve the illicit flow or transfer of funds through

the financial system.

Crimes Against Humanity (Crimes Against Humanity)

A crime against humanity incident involves an individual or a group that knowingly attempts,

commits, or conspires to conduct or participate in a widespread or systematic attack against a civilian

population as directed by an organization, group, government, state military, or paramilitary. The

following acts are examples of crimes against humanity when acknowledged by an authoritative

institution such as a government, the UN, or the EU:

• Apartheid involves acts that are committed in the context of an institutionalized regime or

systematic oppression and domination by one racial group over any another racial group or

groups and that are committed with the intention of maintaining that regime.

• The deportation or forcible transfer of a population is the forced displacement of persons by

expulsion or other coercive acts from the area in which they are lawfully present without

grounds that are permitted under national law.

• An enforced disappearance is the arrest, detention, or abduction of persons by, or with the

authorization or support of, a state or political organization and a refusal to acknowledge the

deprivation of freedom or provide information on the fate or whereabouts of those persons with

the intention of removing them from the protection of the law for a prolonged period of time.

• Enslavement is the exercise of any or all powers in the right of ownership to a person (for

example, human trafficking).

• Extermination is the intentional infliction of conditions of life that is calculated to bring about the

destruction of a population in whole or in part. Inflictions can include the deprivation of access

to food and medicine or the deprivation of reproductive capacities.

• Genocide involves acts that are designed and committed with the intent to bring about the

destruction of a group in whole or in part.

• Murder is the killing of another human being.

• Persecution involves acts against an identifiable group on political, racial, national, ethnic,

cultural, or religious or gender grounds.

• Sexual violence can include rape, sexual slavery, or any other form of sexual violence of

comparable gravity.

• Torture is the intentional infliction of severe mental or physical pain or suffering.

Cybercrime

A cybercrime incident involves an individual or a group that unlawfully attempts, commits, or

conspires to use the Internet, electronic communications networks, or information systems in an

organized and systemic manner as a tool to conduct fraudulent transactions, theft of data for

financial gain, prohibit transactions, or transmit the proceeds of fraud to financial institutions or to

others that are connected with the scheme in furtherance of terrorism, terrorism financing, money

laundering, organized crime, corruption, hostage taking, or other related AML predicate offenses.

Excluded Incidents

• Cybercrimes that are not likely to involve the illicit flow or transfer of funds through the

financial system or a heightened risk of abuse of the financial system

• Cybercrimes that involve software piracy for personal use

Debarred

A debarred incident involves an entity that has been officially prohibited, excluded, or banned by a

regulatory agency or professional trade organization from the following activities:

• Practicing a profession

• Associating with persons of a particular profession

• Conducting business with a governmental or transnational organization

• Enjoying certain privileges, memberships, or practices

• Participating in specified business transactions, dealings, or contracts

Disciplined

A disciplined incident involves incidents where a regulatory authority has imposed a fine,

suspension, cease and desist order, or other forms of temporary or permanent corrective action that

was a result of violating a code or law or engaging in improper practices or unlawful business

activities.

Disqualified

A disqualified incident involves an entity that has been declared permanently or temporarily

ineligible, unfit, or unqualified in their current position or has been deprived of their legal, official, or

other rights or privileges, or categorized as “disqualified” specifically by a regulatory authority, which

may be the result of misconduct, legal violations, or fiduciary duty breaches in a specified

jurisdiction.

Drug Trafficking

A drug trafficking incident involves an individual or a group that attempts, commits, or conspires to

engage in organized and systemic illicit trade that involves the cultivation, manufacture, distribution,

sale, importation, exportation, or dispensation of substances which are subject to drug prohibition or

controlled distribution laws. These incidents can include acts in conjunction with or in furtherance of

political destabilization, terrorism, civil war, regional conflicts, extra-judicial paramilitary activity,

organized crime, or in connection with other related AML predicate offenses that demonstrate an

elevated risk of abuse of the financial system.

Excluded Incidents

• Mere possession of a substance subject to drug prohibition

• Funds that are transferred or activities in connection with medical marijuana or recreational

marijuana in jurisdictions which have authorized or decriminalized commercial commerce

• Incidents that lack evidence of an organized pattern of abuse, conspiracy, or material financial

motive

(for example, a single instance of a small quantity of drugs that fails to demonstrate evidence

of an organized scheme of “distribution for profit”)

• Incidents that are unlikely to involve the illicit flow or transfer of funds through the financial

system

Embezzlement

An embezzlement incident involves an individual or a group that attempts, commits, or conspires to

misappropriate personal or government financial assets from entities that have been lawfully

entrusted with the care of the assets or by the entrusted entities themselves (for example,

employee, clerk, agent, trustee, public officer, or other person that acts in a fiduciary character) to

covertly and fraudulently convert these assets for their own use or benefit or transfers the assets to

a third party for their own use and benefit.

End Use Control

An end use control incident involves an entity that is associated with dual-use (items that have both

commercial and military or proliferation applications) and military hardware or technology exports

whose sale and trade pose an elevated risk of violating non-proliferation regulations and sanctions.

End users are entities that are abroad that receive and ultimately use exported and re-exported

items and that may not be the forwarding agent or intermediary, but may be the purchaser or

ultimate buyer or financier.

The following lists are examples of the military end-use export control lists that may list these

entities:

• U.K. Export Control Organization’s End-Use Controls list

• Japan’s Ministry of Economy, Trade and Industry End-User list

• U.S. Export Administration Regulations list

Environmental Crimes

An environmental crime incident involves an individual or a group that attempts, commits, or

conspires to systemically and wilfully engage in illegal acts that directly harm the environment and

aim at benefiting individuals or groups or organizations from the exploitation of, damage to, or trade

or theft of natural resources. These acts are in contravention of international environmental laws and

regulations, the prescribed environmental laws of the subject legal jurisdiction, or in violation of any

extraterritorial laws to which the entity is subject with the wilful intent to secure material financial

advantage through profit or cost avoidance from the activity. These incidents can include the

following acts:

• Dumping industrial wastes into water bodies

• Illicit trading in hazardous waste

• Trafficking endangered species or government-protected environmental goods

• Smuggling of Ozone-depleting substances

• Illegal logging and trade of stolen timber in violation of the wildlife laws

Excluded Incidents

• Instances of neglect or instances that do not demonstrate a financial incentive

• Lacey Act violations

Espionage

An espionage incident involves an individual or a group that attempts, commits, or conspires to

secretly gather political, military, or economic information about a foreign or domestic government

or commercial enterprise for the purpose of placing one’s own government or corporation at some

strategic or financial advantage. This information includes trade secrets from a private enterprise.

Excluded Party

An excluded party incident involves an individual or a business that is subject to administrative and

statutory exclusions across the United States government and is excluded from receiving federal

contracts, certain federal subcontracts, or certain federal financial and non-financial assistance and

benefits. These entities may already have been debarred or suspended from practice by a

government agency or professional association, under investigation for legal violations, or under

criminal indictment (for example, entities that are listed on the Excluded Party List Systems).