As it is a directive, not a law, EU member states have a considerable amount of freedom in the way the AMLD is amalgamated into their respective constitutions. Over a third of the firms surveyed reported that scarce resources remained their greatest challenge when implementing KYC and CDD processes. Traversing borders By far the greatest issue hindering AML measures in the EU, though, is the lack of cross-border information sharing and targeted action against money launderers.
While each country within the bloc has its own financial intelligence unit FIU — whose main task is to identify suspicious transactions on behalf of prosecutors — these organisations do not share information with their international counterparts. This is particularly problematic when attempting to tackle money laundering in the eurozone as a whole, as the countries with the flimsiest AML procedures tend to bear the brunt of the crime.
This, in turn, has a knock-on effect on other nations within the bloc. The greatest issue hindering anti-money laundering measures in the eurozone is the lack of cross-border information sharing. According to a study by Europol, 65 percent of the suspicious transactions detected across Europe took place in the UK and the Netherlands. This came as a surprise for many, as both countries have advanced banking sectors and theoretically should have had highly robust AML procedures in place.
Some, including the Dutch central bank, DNB, have placed the blame squarely with banks themselves. We just need the right environment to support that kind of collaboration. As a European group of countries, we are in a much better position than ever before, but there is still much more to be done to drive that agenda forward. Lusk was sentenced to 30 months in prison for distribution of marijuana and money laundering.
MacKenzie, Jr. In October , MacKenzie pleaded guilty to 13 counts, including RICO conspiracy, racketeering, mail fraud, wire fraud and money laundering in connection with his decade-long scheme to siphon off considerable financial assets of a church located in the Beacon Hill area of Boston. MacKenzie was able to gain control over substantial church assets, including an story apartment building in downtown Boston, because the church had a small number of voting members, many of whom were elderly.
After obtaining control, MacKenzie stole church funds through a combination of fraud, deceit, theft, and bribery.
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Garcia-Hurtado pleaded guilty on Oct. According to the plea agreement, around June to on or about Dec. The marijuana was brought from Mexico through the desert into Arizona by backpackers and then Garcia-Hurtado coordinated the distribution of bulk quantities of marijuana within the United States and the return of the drug proceeds to Mexico. In June , Trevino pleaded guilty to one count of conspiracy to possess with the intent to distribute cocaine base and one count of money laundering.
Trevino was also ordered to forfeit a residence, two vehicles, a firearm and assorted ammunition. In mid-December , co-defendant Rene Villastrigo, Jr. He pleaded guilty to one count of conspiracy to possess with the intent to distribute cocaine. According to court documents, beginning in and continuing to April 18, , Trevino and Villastrigo conspired with others to possess with the intent to distribute cocaine and cocaine base. Trevino traveled frequently to McAllen, where he recruited another individual to transport drugs from McAllen to Wichita Falls.
Trevino also recruited Villastrigo to rent a residence in Wichita Falls to store and repackage the drugs for distribution. Trevino deposited the drug proceeds he acquired into bank accounts in Wichita Falls and withdrew those deposits in the McAllen area, intending for these financial transactions to conceal his drug trafficking activity.
In March , Waleed Yaghmour was charged with 43 others in a health care fraud and drug distribution scheme.
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According to court documents, Sardar Ashrafkhan and others, who owned home health agencies, provided kickbacks, bribes and other illegal benefits to physicians in exchange for prescriptions for patients with Medicare, Medicaid and private insurance. The prescriptions were for controlled substances such as oxycodone Oxycontin. During the conspiracy, prescriptions were presented to the Sav-Mart Pharmacy in Detroit, which was owned and operated by Yaghmour, as well as several other pharmacies.
Yaghmour knew that the controlled substances he dispensed for these fraudulent prescriptions had no legitimate medical purposes. Yaghmour dispensed at least 1, oxycodone , hydrocodone and , alprazolam doses as part of the scheme. Many of the defendants charged in the indictment have been convicted by pleas and have been sentenced already. Smith pleaded guilty on July 31, to conspiracy to possess with intent to distribute cocaine and marijuana, possession of firearms in furtherance of a drug trafficking crime, and conspiracy to launder money.
Further investigation revealed that Smith used the drug proceeds to purchase several vehicles and had the vehicle titles put in the name of third parties to disguise the true ownership of the property. Gruber was sentenced to 48 months in prison and three years of supervised release. On Aug.
According to court documents, in late , Scott Gruber changed his business, Independent Promotions, Inc. On Oct. According to court documents, Jenkins participated in a drug trafficking organization that involved individuals in California using the U. Mail and commercial carriers to send large quantities of cocaine to co-conspirators in the Hartford area who sold the narcotics for profit. Jenkins, Nance and others then distributed the cocaine, or converted the cocaine into crack for street sale. Certain co-conspirators traveled to California with a large amount of cash to finance the purchase of cocaine.
Co-conspirators also made numerous cash deposits into local bank accounts, as well as wire transfers. Miller and Nance have pleaded guilty and await sentencing. Chukharev pleaded guilty in September to conspiring to operate an unlicensed money transmitting business. The fact that Liberty Reserve had not registered as a money transmitting business under U. In October , Gonsalves was convicted of oxycodone conspiracy, money laundering conspiracy and money laundering. According to court documents, Gonsalves and his brother, Stanley D.
The primary object of the related money laundering conspiracy was to use the millions of dollars in drug proceeds to purchase additional oxycodone pills and to pay the ongoing expenses of the oxycodone conspiracy. Stanley D. Gonsalves, of Sandwich, was convicted of oxycodone trafficking conspiracy, money laundering conspiracy and 17 substantive money laundering charges.
Bumpers pleaded guilty in March to RICO conspiracy to commit securities fraud, bank fraud, wire fraud and money laundering conspiracy. Four other defendants have received sentences ranging from an eight month split sentence to 46 months in prison. Faiella, an underground Bitcoin exchanger, pleaded guilty in September to operating an unlicensed money transmitting business. BitInstant was designed to enable customers to exchange cash for Bitcoins anonymously, that is, without providing any personal identifying information, and charged a fee for its service.
In February , Belciano pleaded guilty to conspiracy to distribute kilograms of marijuana in and through central Pennsylvania and conspiracy to commit money laundering between December and November According to court documents, Zafar, told the primary victim of his real estate scheme that his uncle was the Minister of Defence of Pakistan and was responsible for acquiring land on behalf of the Pakistani government.
Zafar recruited the victim to be his partner in purchasing such land before the Pakistani government did, saying they would then sell the land to the government at a greatly inflated price. In February , a federal jury convicted Davey of securities fraud conspiracy, wire fraud conspiracy, money laundering conspiracy and tax evasion. Davey controlled most funds and wires and published a website for victims that reflected fake high returns.
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Davey also used an elaborate network of shell companies to evade taxes and commit money laundering with the proceeds of the Ponzi scheme. Ten other defendants have been sentenced in this case to terms ranging from 40 years to six months in prison. Shrem was also the Vice Chairman of the Bitcoin Foundation, a foundation dedicated to promoting the Bitcoin virtual currency system. Faiella, ran the underground Bitcoin exchange on the Silk Road website. Shrem was fully aware that Silk Road was a drug-trafficking website and he also knew that Faiella was operating a Bitcoin exchange service for Silk Road users.
Faiella, pleaded guilty in September , and his sentencing has been scheduled for a later date. Capra was convicted on March 21, , on fourteen counts of wire fraud, two counts of mail fraud, and ten counts of money laundering. GDG , a company which built and sold houses. From January through July , Capra and others executed a scheme to defraud several mortgage lenders through applications for residential mortgage loans and related documents associated with real estate purchases.
He also sold a large volume of homes to otherwise unwilling or unqualified buyers. Flynn pleaded guilty on April 23, to mail fraud and unlawful monetary transactions. Flynn also used the stolen funds to pay a personal credit card, to travel to tropical destinations, sometimes paying for friends to join him, and on at least one occasion, to charter a private plane.
On Nov. According to court documents, Weikal-Beauchat, who has since been disbarred, was an attorney with the Gettysburg firm of Beauchat and Beauchat, concentrating on estate, trust, and long-term care planning. Weikal-Beauchat used the proceeds to operate her law firm, for vacations and other personal expenses.
She generated bogus bank CDs and distributed them to her clients to further mislead them. Prolman pleaded guilty on April 29, According to court documents, between and October , David Jones and others illegally distributed hundreds of pounds of marijuana in Maine and elsewhere. In September , Geary pleaded guilty to conspiracy to commit mail fraud and money laundering. According to court documents, between August and April , Geary, along with his bookkeeper, devised a scheme to defraud his business partners in connection with two capital calls he requested for tenant improvements to their joint real estate development.
His total sentence for the two schemes is 24 years in prison. Weinstein previously pleaded guilty to conspiracy to commit wire fraud, committing wire fraud while on pretrial release and money laundering. The Facebook victims wired millions of dollars that the conspirators then misappropriated. Weinstein did not use this money to purchase the notes on the Florida condominiums; instead, Weinstein and his conspirators converted the money to their own use.
Throughout the scheme, Weinstein was already under indictment and on pretrial release. Weinstein pleaded guilty on Jan. Weinstein was previously sentenced on Feb. Marmilev pleaded guilty in September to conspiring to operate an unlicensed money transmitting business that he knew involved the transmission of funds derived from criminal activity. In conjunction with the sentencing, a civil forfeiture complaint was filed seeking the forfeiture of two businesses located in Brooklyn, and the forfeiture of his interest in a pizzeria located in the Coney Island area of Brooklyn.
Marmilev was a longtime associate of Liberty Reserve founder Arthur Budovsky and served as Liberty Reserve's chief technology officer. It emerged as one of the principal money transfer agents used by cybercriminals around the world to distribute, store, and launder the proceeds of their illegal activity. Marmilev worked for Liberty Reserve for years despite knowing that the business was used extensively to process criminal transactions. These funds encompassed suspected proceeds of credit card fraud, identity theft, investment fraud, computer hacking, child pornography, narcotics trafficking, and other crimes.
Cagle pleaded guilty on May 21, to conspiracy to distribute a controlled substance and money laundering. According to court documents, on about January through September , Cagle and others were part of a large scale narcotics organization involved in importing, manufacturing and distributing cocaine. Specifically, Cagle was responsible for distributing multiple kilograms of cocaine.
Cagle was also involved in operating an unlicensed money transmitting business, often transporting several hundreds of thousands of dollars from Ohio to Texas. Rasmussen pleaded guilty on Sept. According to court documents, from approximately January to December , Rasmussen received marijuana through the mail in South Dakota from her source of supply in California.
When the amounts of marijuana became too large to mail, Rasmussen had co-conspirators drive to California and back to South Dakota with large quantities of marijuana. In addition, Rasmussen deposited the proceeds of marijuana sales into her bank account in South Dakota. She also deposited drug sales proceeds into the account of her source of supply, and instructed a co-conspirator to deposit marijuana proceeds into her account.
Jules previously pleaded guilty to one count of money laundering. In addition, Jules spoke about engaging in tax fraud and offered to launder the proceeds of tax fraud for a fee. None of the individuals or estates of individuals listed on the tax returns received any money. Schleider previously pleaded guilty to wire fraud. They told the victims that Weinstein could purchase Belle Glade Gardens at a discounted price and immediately flip it at a substantial profit. Peterson was convicted by jury trial in May for bank fraud, money laundering and making false statements to banks.
According to evidence given at the trial, between and , Peterson committed two acts of bank fraud and made false statements to banks by lying to a bank about the purpose of a wire transfer of funds taken from Maverick, Inc. On May 12, , Wirken pleaded guilty to one count of money laundering.
Wirken was a lawyer and principal at The Wirken Law Group until he surrendered his law license in and was disbarred by the Missouri Supreme Court. Wirken wrote six checks between December and Jan. As early as , Wirken began improperly borrowing substantial amounts of money from clients, and then he refused to pay his clients back. Devine pleaded guilty on Feb. According to the plea agreement, beginning in approximately February , Devine engaged in a scheme to defraud Apple of money or property as well as to defraud Apple of its right to his honest services.
In the course of the scheme, Devine transmitted confidential information, such as product forecasts, pricing targets, and product specifications, to suppliers and manufacturers of Apple parts. In return, the suppliers and manufacturers paid Devine kickbacks. The scheme enabled the suppliers and manufacturers to, among other things, negotiate more favorable contracts with Apple than they would have been able to obtain without the confidential information.
Devine received kickbacks as wire transfers into bank accounts that he opened for that purpose in the U. Devine knowingly transferred the proceeds of the wire fraud between his various accounts, including CPK Engineering accounts, in order to conceal and disguise the nature, location, source, ownership, and control of the proceeds. Miller previously pleaded guilty to the interstate transportation of stolen goods and money laundering.
According to court documents, from approximately June through January , Miller stole copper wire from his former employer, an RV manufacturer located in Elkhart, Indiana. Miller then sold the copper to scrapyards after transporting the copper wire across the state line from Indiana to Michigan locations. He used these illegal funds to gamble at various casinos.
Miller deposited cash into his bank account when he won at the casino because then he was able to justify to the bank where the cash came from. He avoided putting money from his sells of stolen copper wire directly into his bank accounts because he did not want to justify the source of the cash.
Previously, Davian pleaded guilty to one count of securities fraud, two counts of mail fraud, four counts of wire fraud, and seven counts of money laundering. Ladio pleaded guilty on Dec. On two occasions, Ladio convinced existing MidCoast customers to apply for commercial loans, ostensibly for valid business purposes. The true purpose of the loans, however, was to allow those MidCoast customers to loan money to Ladio.
Ladio engaged in the nominee loan scheme in substantial part to make interest and principal payments under the Agreement. Both were convicted of conspiracy to distribute controlled drug analogues, possession of Schedule 1 controlled substance analogue with intent to distribute, maintaining drug-involved premises, and money laundering.
The men were charged with depositing funds from the illegal sales and distributions of the controlled substance analogues into a checking account in Missouri. Khdeer previously pleaded guilty to 13 counts, including money laundering, malicious use of fire, conspiracy to harbor aliens, identity theft, conspiracy to commit health care fraud and filing false claims.
In , the Findlay IHOP burned as the result of arson started by a co-conspirator at the direction of Elkafrawi and Khdeer to facilitate an insurance fraud scheme. Additionally, Khdeer used two identities to split his salary from the restaurants between two paychecks, creating lower reportable income for both identities. Elkafrawi was sentenced to eight years in prison. Landells previously pleaded guilty to conspiracy to launder monetary instruments. According to court documents, Landells directed the activities of his estranged wife, and at least seven co-conspirators to assist him in the trafficking marijuana from Mexico throughout, New York, Florida, Virginia, Arizona, and North Carolina.
In order to disguise the source of the proceeds from his illegal activities, Landells also operated sham companies purporting to be in the candle manufacturing business. Civella, Jr. Civella moved money between the ATM machines in order to conceal the theft from the bank. Public partners such as law enforcements should be responsible for analytics and repression. Combating illicit finance not only protects our financial system from abuse by money launderers, terrorist financiers, weapons proliferators and others engaged in financial crime, but it helps to advance our most critical foreign policy and national security objectives.
The many tools that the Treasury Department can deploy — ranging from anti-money laundering regulatory oversight, to outreach to counterparts overseas, to deploying targeted financial measures focused on particular individuals and entities — play an integral role in responding to many of the challenges we face. The combat against money laundering was started as early as with lawful criminalization of money laundering.
The United States government was concerned over the increasing threat of organized crime and infiltration in legal economy. Large sum of money were said to be in control of criminal elements, it was believed that underground economy was expanding. Financial Crime Enforcement Network aka FinCEN was established in to provide the United States government with intelligence, knowledge, and data from multiple sources.
FinCEN would also provide guidelines and capabilities to analyze data to help regulatory agencies and prosecutors detect, investigate, and prosecute financial crimes. FinCEN carries out its mission by receiving and maintaining financial transactional data; analyzing and disseminating that data for law enforcement purposes; and building global cooperation with counterpart organizations in other countries and with international bodies.
All public and private financial organizations are obliged to report any suspicious activity to FinCEN. Suspicious Activity Reports aka SAR are filed in connection with transactions that financial institutions know, suspect, or have reason to suspect may be related to illicit activity. These reports are especially valuable to law enforcement because they reflect activity considered problematic or unusual by depository institutions, casinos, MSBs, securities broker-dealers, mutual funds, futures commission merchants, introducing brokers in commodities, and insurance companies. About 1. Such transactions are reported to the Treasury and the U.
Secret Service. In , FinCEN received over In , FinCEN received approximately 14 million reports. After an incident of September 11, , The Congress of United States renewed the focus on detection, prevention, and prosecution of money laundering with terrorist financing in mind. IMLAFA expands the scope of money laundering laws to cover a broader range of financial institutions than those covered by traditional money laundering laws and required all financial institutions to implement programs designed to deter and detect instances of money laundering.
Financial institutions are obligated to undertake enhanced customer due-diligence on customers in the higher risk category. Recommendations provide specific measures for addressing risk associated with PEPs and correspondent banking relationships. This type of due-diligence requires having appropriate risk-based procedures to decide whether a customer is considered politically exposed personnel PEP , senior management approval for establishing business relationships with PEPs, and ongoing monitoring of the business relationship relating to the source of funds.
Financial firms which have PEP exposure are required to have compliance specialist, commercially available PEP database, and enough controls in place to monitor PEP activities. Recent statistical data published by Internal Revenue Service on Money Laundering related investigations suggest uptick in number of investigations and Incarceration. The FATF was created to help enhance international cooperation and assess the results of anti-money laundering policies globally.
The Financial Action Task Force FATF is an inter-governmental body whose purpose is the development and promotion of policies, both at national and international levels, to combat money laundering and terrorist financing. The Task Force is therefore a "policy-making body" which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.
The FATF monitors members' progress in implementing necessary measures, reviews money laundering and terrorist financing techniques and counter-measures, and promotes the adoption and implementation of appropriate measures globally.
In performing these activities, the FATF collaborates with other international bodies involved in combating money laundering and the financing of terrorism. All APG members commit to effectively implement the FATF's international standards for anti-money laundering, combating the financing of terrorism and anti-proliferation financing, referred to as the 40 Recommendations.
The 40 Recommendations were revised and adopted by the FATF membership after world-wide consultation including the private sector in February National government and other regulatory agencies have started publishing penalties imposed on individual or organization entities involved in any form of money laundering attempt. It is very common to see published news about somebody being investigated or held on money laundering related criminal activities. There are known cases of USCC publishing fines to various Financial Institutions when audits found that there were not enough anti-money laundering procedures implemented or found guilty of working around anti-money laundering procedures to enable certain payment transactions pass through.
In , DeLay was found guilty of money laundering and conspiracy to commit money laundering. Franklin Jurado, a Harvard-educated Colombian economist, pleaded guilty to a single count of money laundering in a New York federal court in April and was sentenced to seven and a half years in prison. Some of the accounts were opened in the names of Santacruz's mistresses and relatives, others under assumed European-sounding names. He established European front companies with the eventual aim of transferring the "clean" money back to Colombia, to be invested in Santacruz's restaurants, construction companies, pharmacies and real estate holdings.
The Jurado case is an example of the increasingly sophisticated means drug cartels employ to secure assets. But it also indicates that the very profits that motivate drug organizations are an Achilles heel and those national legislators, law enforcement agencies and international bodies are stepping up efforts against money laundering. On January 6, , in Plano, Texas, Steve Ham was sentenced to 16 months in prison and three years of supervised release for money laundering. According to court documents, Ham was part of a scheme with Richard Arledge, owner and operator of Richard Arledge Suzuki and the director and president of Expressway Financial, Inc.
Arledge and Ham intentionally sold high-end luxury cars to individuals who derived their income from the illegal distribution of controlled substances, the promotion of prostitution, and mail and wire fraud. These criminal customers usually paid for their luxury cars in cash and provided tens of thousands of dollars in cash to the dealership in pillowcases, shrink-wrapped plastic packages, backpacks, and even fast food paper bags.
Arledge was sentenced to months. Fourteen others were convicted or pleaded guilty in connection with the money laundering scheme. On January 4, , in Trenton, N. To conceal and disguise the nature and source of the funds, Haim directed Dwek to make the checks payable to several organizations that Haim operated. Once he received the checks from Dwek, Haim deposited them into bank accounts held in the names of the organizations and then wired the proceeds of those checks to a co-conspirator in Israel, or to bank accounts held by other individuals and corporations in various foreign countries, including Israel, Turkey, China, Switzerland and Argentina.
The co-conspirator in Israel would then make cash available through an underground money transfer network, including at the cash houses operated by Schmuel Cohen, aka Schmulik Cohen; Yeshaye Ehrental, aka Yeshayahu Ehrental and Yishay Ehrental, and Weiss. Weiss admitted that from June to July he operated an unlicensed money transmitting business with individuals residing in Israel.
Ehrental and Cohen, both of Brooklyn, pleaded guilty to operating an illegal money transmitting businesses and were each sentenced to 18 months in prison on September 9, , and August 24, , respectively. Senate panel in a money-laundering inquiry, the latest step in a long-running U.
The inquiry is being conducted by the Senate Permanent Subcommittee of United States on Investigations could yield a report and congressional hearing later this spring. The subcommittee has a history of conducting high-profile hearings that have proved embarrassing for the world's biggest banks. Since , European and U. On March 22, , in New York, N. In September , Lopez pleaded guilty to one count of structuring. According to court documents, Lopez assisted a narcotics distribution organization by transporting and concealing narcotics proceeds.
On March 14, , in Indianapolis, Ind. According to court documents, Eads and a related defendant, John Richards, worked together in and to sell houses to real estate investors. Richards, a mortgage broker, falsified numbers on loan applications, and Eads enticed investors by assuring them there would be no risk to invest in properties he had for sale. Eads paid down payments and paid money outside of closing, asking investors to falsify invoices for work that was never done. In a separate scheme in , Eads suggested that a longtime acquaintance join with him in purchasing investment properties with funds provided by the acquaintance.
The first several transactions were positive, with the acquaintance and Eads both receiving small profits upon the sales. Then, Eads sold numerous properties to his acquaintance and provided titles of properties that he did not own. In yet another scheme, Eads partnered with an investor from Utah in This investor and Eads discussed purchasing 38 properties in Indianapolis, Muncie, and Anderson.
Eads provided details of the properties like pictures and the sales prices. The Utah investor wired money to Eads to purchase the properties. However, the investor never received deeds, and an inspection of records revealed that Eads did not own several of the properties in question. There are thousands of other cases published by authorities or leading newspapers. Authorities hope to warn criminals against further money laundering attempts by making these cases publicly available and generate awareness among citizens.
For many financial institutions, compliance with anti-money laundering programs is seen as a problem to be solved at business unit or geography level.
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Money laundering itself is a cross-geography, cross-branch and cross-business challenge. Financial institutions are challenged with regulatory laws across geography and markets. Araujo says that even though money laundering is accepted as global challenge and national governments worldwide have started to create agencies, regulations, and laws to fight it, advancements of national anti-money laundering regulations and their efficiencies are being challenged. Proper application and implementations of regulations face challenges that range from unwillingness of financial institution to being cost effective.
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Countries are required to constantly changing their anti-money regulations. It becomes a challenge for financial institutions to determine which regulations to obey. And face greater challenge to ensure that they are complying with the regulations that govern their worldwide activities. Some countries have specific laws which are deemed as prescriptive enforcing activities whereas financial institutions in other countries have to comply by adopting specific practices such as risk-based approach.
Therefore, multinational financial institutions are challenged with single global standard governing their client acceptance and on-boarding policies and conducting payment transactions. International standards are not always mandatory in some countries. Financial institutions often find themselves alone in determining what their needs are, what regulations they must obey to, what recommendations they should follow upon, and how to implement systems with their technical environment.
Complying with laws of various countries requires extra activities to be performed while ensuring efficiency in daily business operations. These can become quite costly for financial institutions and require extra efforts from financial institutions. Most anti-money laundering schemes depend on the creation of mechanisms that make banks and their employees to cope against money laundering since a great deal of corruption combat departs from their reports on suspicious activities. One of the reasons for these struggles is the lack of effectively involving stakeholders and financial institutions to combat money laundering.
The central aim of the anti-money laundering regulation is to design a system of procedures and incentives that induces financial institutions to act effectively with regard to the production of the necessary information towards suspicious activities. There are a number of papers in the literature that intends to give more precise reasons for the lack of efficiency of the anti-money laundering regulation. The point raised by various researchers is that the burden of an efficient report system cannot fall entirely on financial institutions since they may face legal schemes that create incentives to not report suspicious activities.
Technology has advanced rapidly in last couple of decades. Due to these advancements, wire transfers have become faster even across borders. It is very common to transfer chunk of money from one bank in one country to another bank in another country within a day. Sell of goods or assets and money reimbursements can happen within minutes. Technology has made it easier to connect people across world. Online banking has made easier to manage bank accounts even if financial institutions are located overseas.
These advancements make it difficult to identify, monitor, and freeze financial transactions involved in money laundering. The challenge is that anti-money laundering is a complex process involving many entities and should be able to detect precisely. Many times, financial institutions are not equipped with technical systems to acquire and maintain all customer identification attributes required to file proper suspicious activity reports. On the other side, advancements in technology are helping financial organizations to help combat money laundering.
Computerized payment processing systems help find patterns of money movements across accounts which can be flagged as suspicious activity. Technological advancements have been made to screen all cross-border payments data against so called watch lists published by various regulatory authorities such as OFAC Office of Foreign Asset Control , Financial Action Task Force, European Union, FBI, etc before initiation of payment and hold the payment until further investigation completes.
Technologies can be a big help in detecting suspicious activities. There are many AML vendors providing cutting-edge technical solutions in market that financial institutions can benefit from. Technology can help maintaining risk based profile for each and every customer based on transactional activities, relationships with PEPs, and real-time payment screening against PEP database, Interdiction database, and other private lists such as fraud list, black list, white list, frozen list, etc.