Comment from Jim Muir, financial data management experts, AutoRek, regarding the latest figures from BDO revealing a surge in money laundering cases:
“The value of money laundering cases may have quadrupled, but this rise is not necessarily linked to an increase in crime. Instead, the emergence of a global network of collaborating regulators and an increasing confidence in rewarding whistle-blowers is likely to have contributed to improvements in money laundering detection.
Regulators have long been stepping up their initiatives against money laundering with the introduction of heavy penalties for financial institutions whose existing systems are lax. However, improved data gathering, sharing tools and matching engines will all continue to improve detection rates and confiscations in the year ahead. As a result, retail banking organisations need to develop strong data management processes, which effectively establish the identity of ‘beneficial owners’ of corporate bodies or partnerships, monitor customers’ business activities and automatically escalate anything suspicious whilst storing all documents relating to financial transactions, procedures and processes. In addition, organisations also need to complete money laundering risk assessments for prospective clients at the start of a relationship and also regularly review the assessment on an ongoing basis for any existing customers. Only by developing effective financial controls and taking proactive measures to prevent money laundering will the industry be able to reverse the rising volume of cases emerging.”