Wire transfer company Western Union is back — but money launderers won't find it an easy route to funnel cash for overseas drug deals without being detected.

After Western Union closed in Bermuda in 2002, there was a sharp drop in suspicious activity reports sent to Police.

However, now the company has hooked up with Bermuda Financial Network to offer money transfers at a Front Street venue which the company hopes will be open within three weeks.

Bermuda Financial Network vice president Alvin Wilson told The Royal Gazette that top-notch technology would trace transfers and share information with Police.

He added: "We talked with the heads of the Financial Investigation Unit and asked them what they would be looking for as far as information about someone using our system for fraudulent or illegal purposes.

"We have basically built a system around that, which will be very helpful."

He said money transfer systems had been used in the past to send cash to drug importers in Bermuda's $200 million-a-year illegal narcotics trade.

"Since Western Union stopped there has been no lack of drugs on the Island and, unfortunately, when a system like Western Union is not being used, then it's hard to trace where the money is going and how it is going.

"So people are carrying out tens of thousands of dollars on their person, people are sending money in courier packs and Police have absolutely no idea, there's just no way they can trace where the money moves.

"With Western Union being on the Island it's actually going to be better as far as knowing where funds are coming from and where funds are going.

"We have built technology which means every time a transaction is done it goes into a database, we can then send electronic files of those transactions to the Financial Investigation Unit.

"Everything will be at the press of button to send suspicious activity reports which go directly into their database. We have taken it to a totally different level."

And Mr. Wilson said his company was also hoping to capitalise on the fact there is lots of legitimate business out there.

He said in the six years since the last Western Union branch closed there has been an increase in workers from all over the world.

Banks here won't wire money for non-customers which has led to guest workers having to trust their savings to friends who are going back home.

"They are hoping the funds will reach the destination, we could be talking about thousands of dollars."

And he said there were certain parts of the world where wire transfers to banks weren't a viable option.

He recalled being stopped on the street by someone who regularly had to send funds to a daughter in Africa for studies.

"He would wire funds over there but he said they had a very fragile banking system which meant money sometimes never reached the bank account.

"He said the absolute best way to send money is through Western Union because the receiver can go by within minutes and pick the money up rather than hope some bank official doesn't divert the funds."

The Bermuda Monetary Authority is reviewing the application by Bermuda Financial Network to open.

Mr. Wilson said: "It could be three or four weeks away."

Bermuda Financial Network, run by two Bermudians, was set up more than a decade ago and represents American Express.

Western Union had been operated under Capital G Bank when it closed in 2002.

The new Western Union outlet will open, once approved, on the British/American building in Front Street on the King Street junction.

Last year Government passed three bills to make life more difficult for criminals to launder money and a new body, the Financial Intelligence Agency was set up to analyse suspicious activity reports.

However, Bermuda still came under criticism from the International Monetary Fund for not doing more to combat money laundering in a hard-hitting report released earlier this year.

Asked what else was being done Finance Minister Paula Cox told The Royal Gazette: "There is much that is coming — legislation in this Parliamentary session."

It's thought the new laws could bring reporting requirements on businesses such as jewellers and car dealers which accept large cash purchases because experts believe this is another route to hide illicit profits.