The annual report of the National Financial Investigations Center in Bahrain for 2024 revealed five patterns used by criminals for financial fraud and money laundering in Bahrain. These include the use of commercial records for trade-based money laundering, selling fake insurance policies and defrauding individuals, loan fraud targeting financial institutions, exploiting delivery drivers in money laundering, and offering fake investment opportunities.

Regarding the use of commercial records for trade-based money laundering, the report indicated that an organized criminal network formed an unofficial channel to transfer money abroad illegally called “Hawala Dar”. This network exploits commercial records to deposit money collected from individuals into company bank accounts, then purchases goods and equipment from a foreign country using those funds, directing them to a third country to sell and deliver the proceeds to individuals wishing to transfer money there. This exploits trade transactions to disguise the true nature and ultimate beneficiary of the funds, avoiding the official financial system to evade legal accountability.

Regarding selling fake insurance policies and defrauding individuals, the report noted many suspicious financial reports about fake insurance policies sold to customers as effective insurance, aiming to profit through forgery. The main purpose of issuing these policies was to meet travel requirements abroad, which could expose customers to legal problems when trying to use the insurance for treatment abroad without knowing it was forged.

As for loan fraud targeting financial institutions, the report stated that this pattern involves individuals of Asian nationalities submitting fraudulent documents to obtain loans from financial institutions. Once the loan is approved and disbursed, these individuals flee the country leaving the loans unpaid, constituting clear fraud against financial institutions and unauthorized loan acquisition. This pattern represents a new technique negatively impacting the financial system.

Regarding exploiting delivery drivers in money laundering, the report observed a pattern through suspicious financial reports where some drivers use their personal bank accounts to receive money from drug trafficking. These drivers, who are supposed to use their accounts to receive legitimate order payments, mix criminal proceeds with legitimate funds. These illegal transfers often occur via digital payment applications, representing a dangerous evolution in money laundering methods as criminals exploit popular digital services and the ease of transfers to conceal the source of their illicit funds.

Concerning offering fake investment opportunities, the report indicated widespread advanced fraud targeting individuals via social media platforms. Scammers exploit these platforms to offer fake investment opportunities that appear attractive for quick and easy profits, deceiving victims into believing they can achieve huge wealth by buying and selling cryptocurrencies at specific times for “guaranteed” profits. Scammers often use convincing marketing techniques, fake images, and videos to lend credibility to their offers.

These fraudulent operations involve two main integrated elements: electronic fraud and money transfers via cryptocurrencies. The danger of this type of fraud is increasing due to the widespread use and accessibility of social media, along with the growing appeal of the cryptocurrency market.