Underground international money transfer, in which money is moved through informal rather than official banking systems, is a recognized means of transferring lawful remittances. However, underground banking has long been viewed as a conduit for money laundering by shady businesses and criminal activities. According to some analysts, underground banking accounts for up to $1 trillion in illegal cross-border money transfers each year.
There are several institutions that offer international money transfer services, but not all of them are respectable and trustworthy.
What is Underground International Money Transfer?
Underground money transfer refers to any informal financial dealings that exist in addition to the regular banking system. Underground banking is also known as alternative remittance systems or informal cash transfer systems.
One reason for underground international money transfer is that the sender does not need to confirm the purpose of the money transfer, thus most people will prefer to use the underground service even though they are aware of the risks involved.
Underground International Money Transfer through Relatives and Friends
This international money transfer method can save you time, but it comes at a cost. Also, keep in mind that in most countries, carrying more than $5,000 in cash or equal in currencies is illegal without declaration with customs.
When the limit is crossed, you must declare the money to confirm its origin and legality, and the customs office will convert the amount you bring with you using the current exchange rate.
This method is generally the most secure of all the methods of transferring money abroad under the table. However, every transaction that is not through official services will still carry certain risks. For example, if you put your trust in the wrong person, you may lose the entire sum, and if the money is lost at customs, there is no legal basis to retrieve it. Alternatively, if the quantity exceeds the maximum limit, customs may flag it as unlawful and seize it.
Underground International Money Transfer through Independent Brokers or Black Market
International money transfer businesses are thriving because the need for money transfers is broad and growing. Many people have chosen the "underground" form of money transfer because they are afraid of lengthy procedures and low transaction costs.
Underground money transfer services have recently appeared through applications (apps), virtual currency exchanges, gold stores, and import and export corporations with big amounts of money, rapid procedures, and little difference in exchange rates. These businesses boldly assert, using highly appealing ads, that they are ready to transfer money to hundreds of countries across the world safely, that the procedure is really straightforward, and that the cost is extremely low, if not free.
For underground money transfers through brokers, you can easily find intermediaries through social networks like Facebook or just a google search away. You will transfer money to them, and then their people in the host country will transfer the money to your relatives.
For underground money transfer via gold (transfer money abroad through the black market) you need to go to stores dealing in gold, silver, gems, etc. or foreign currencies to use the service.
Most people who use this type of service know that unofficial money transfers are illegal, and if they are detected by the authorities, they will be in trouble. Not to mention, in fact, there have been many people being cheated, that is, the service intermediary has received the money but did not deliver the money to the beneficiary. Since transferring money through unofficial channels, the two parties transact with each other mainly on the basis of trust, so if being cheated, it is very risky for the individual because it is impossible to ask the law to intervene.
Underground International Money Transfer through Cryptocurrencies
Cryptocurrency as a form of international money transfer or payment is increasingly being accepted by retailers, individuals, and businesses. Instead of transferring money manually, payment gateways have provided a simpler way to pay with cryptocurrency.
Cryptocurrency payments are a low-cost, quick, and efficient way to transmit funds. For the majority of overseas transactions, you do not even need to use local currency. While the advantages are easy to see, there are still a lot of drawbacks that can be seen when it comes to making payments in cryptocurrency.
One of the biggest downsides that even those with little knowledge of cryptocurrencies may notice is that cryptocurrency prices can fluctuate wildly. This can make financial planning difficult for the recipient.
Meanwhile, perhaps the most important drawback is that the use of cryptocurrencies as a means of payment is not yet widely accepted. The most widely used virtual currency, Bitcoin, became popular in the beginning and almost 80 percent of all bitcoin transactions were from Vietnam, Japan, Korea, and Taiwan. However, many Asian governments have since banned the use of digital money as a legal form of payment.
What are the Risks of Underground International Money Transfers?
You can be scammed: After receiving your money, the intermediary runs away or issues a fake invoice that has transferred the money.
You can be accused of fraud: because there are no legal documents to prove that the two parties have ever had a transaction, when the money has been transferred to the fraud party, they can counter-claim that they are the one who was scammed. At this time your money and account will be locked for investigation.
You may unknowingly aid the consumption of dirty money: Fraud organizations have been taking advantage of third-party money transfers. They use the money obtained from fraudulent activities to conduct these trades. When the police start investigating the fraudulent money flow, you may also be caught in the scope of the investigation.
- If your involvement is light, all information related to your banking transactions will be sent to the relevant authorities for investigation.
- If your involvement is severe, your account and money will be locked (locked in all banks and securities companies). Even if you are innocent, it will cost a lawyer and take a long time to reopen an account.
What to Consider When Transferring Money Internationally
International money transfer transactions are often larger in value and more complicated than domestic transfers. Therefore, when transferring money from abroad, you need to pay attention to a few points as follows:
- For money transfer transactions, use reputed banks or facilities. There are already several firms that provide low-cost international money transfer services. You must consider the loss of personal information as well as deposits.
- It is critical to thoroughly and precisely examine the recipient's information. Check for basic information such as account number, beneficiary bank, and so forth.
- After finishing the operation, the receipt or any documentation must be kept as confirmation of money delivery. This information is critical for checking the account and in the case of a dispute.
Use EzyRemit's Service For Secure International Money Transfer
EzyRemit is an online international money transfer business that is regulated and authorized by the Australian Transaction Reports and Analysis Centre (AUSTRAC) and the Australian Securities and Investments Commission (ASIC).
EzyRemit offers online remittance platforms such as money transfers, international education transfers, and EzyCash Passports for travelers. We are confident in our ability to provide several benefits to regular clients and students. We can assist you in transferring an infinite amount internationally, and we can even assist students in making foreign tuition payments without incurring excessive expenses.
Service benefits:
- Cheaper fees and competitive exchange rates compared to banks and other transfer services.
- Absolute confidentiality of customer information.
- Fast transfers, most transactions will take no more than a day.
- No limit on the transfer amount via bank accounts.
- Completely safe due to being regulated by AUSTRAC and ASIC.
