Anti-money laundering regulators are turning their attention to the activities of charities and other not-for-profit organisations, which they believe are becoming targets for criminal groups because they have large sums of money moving across borders and are not subject to much regulation.The growing infiltration of charities by criminal groups and terrorist organisations is detailed in the Asia-Pacific Group on Money Laundering's Yearly Typologies Report, which was published this week.According to the report, cases of abuse against not-for-profits represent a very small percentage of all activity in the sector. However, not-for-profit organisations are increasingly vulnerable to terror financing and money laundering activities. The report includes several case studies showing how charities have been used to raise funds for terrorist activities. It says: "Not-for-profit organisations have weak regulation. Many of them operate in areas of high conflict where there is very little infrastructure, and where there may be limited oversight."Australia is a member of the Asia-Pacific Group on Money Laundering through the anti-money laundering regulator, Austrac. The Typologies Report is designed allow governments to understand the nature of existing and emerging money laundering and terrorist financing threats, and shape regulatory activity.Other issues raised in the report include the increasingly global nature of money laundering, and the need for greater co-operation between national regulatory bodies; the increasing focus of money launderers on new payment technologies, and the growth of trade-based money laundering.Not-for-profits are subject to internal manipulation of accounts, theft of donor information, bogus websites, the impersonation of street collectors and the skimming of collection boxes. Charitable structures can be used to move funds via an established network while avoiding attention from regulators.Charities raised US$2.8 trillion in 2010, according to the World Bank. There are 1.4 million not-for-profits registered with the United States' Internal Revenue Service and a further 35,000 religious organisations and small charities that are not required to register.There is currently no AML record-keeping requirement for these organisations. Given the scale of the sector, regulators are asking whether they have the right balance between transparency and privacy, accountability and proportionality, enforcement and self-regulation.Money laundering is increasingly the province of international criminal gangs. Frauds involving telemarketing and lottery scams, phoney investment offers, phishing and Nigerian letter scams are often organised by large international groups these days.Foreign gangs often recruit locals to act as go-betweens and use their accounts to transfer funds from hacked accounts, before moving the money offshore. The report says: "A typical red flag may be a dramatic increase in flow-through activity on bank accounts, less a commission, where the accounts are held by students, unemployed people or were previously silent accounts."With the rise in the incidence of schemes where victims are located in different jurisdictions from the perpetrators, a greater emphasis on international regulatory co-operation is needed."The failure to rapidly exchange information and the lack of co-ordinated multi-jurisdictional action to identify and combat the syndicates involved enhances ML vulnerabilities," the report says. The World Bank has noted a general lack of co-ordination between agencies mandated to investigate corruption and