The Need of the Hour!

To Comply or Not to Comply: The Dynamics of Anti Money Laundering (AML)

Whether through a crime television series or a scandal from a major corporation, you have probably heard the term Money Laundering at some point in your life. Money laundering is quite prevalent, with more than USD 2 trillion laundered annually.

Money laundering is simply the act of concealing the origin of criminal proceeds – the criminal practice of making black money look legitimate rather than ill-gotten. When done successfully, the laundered funds can be used to fund other criminal activities and can potentially cause market distortions.

Money laundering usually consists of three steps: Placement, Layering and Integration.

Criminals who engage in fraudulent activities often use money laundering techniques to conceal their illegal activities, which makes it challenging to uncover and prevent fraud.

The pertinent question here is then, how sharply does money laundering affect society? What are its repercussions?

“Washing” Money through Investments – Is that even a Strategy?

The truth is that non-compliance can cost you, rather dearly in several cases. Just because you get away with questionable behavior initially, does not mean that regulators or government agencies will not eventually come knocking on your door.

Compliance is Crucial

With the ever-evolving macro environment. just as in any other industry, the financial industry or for that matter the DNFBPs (Designated Non-Finance Businesses and Professions) have its fair share of questionable behavior. Thankfully, regulatory oversight and accompanying fines for non-compliance, violations and even fraud, exist to keep financial institutions in line.

Anti Money Laundering or AML is critically essential for businesses. It has been used successfully to help companies tackle things such as money laundering, terrorist financing, and theft. AML/CFT technologies can reveal criminal groups’ infrastructure, webs of corruption, and terror-related schemes. In the modern world, AML efforts are not solely focused on preventing the financial system from being exploited for money laundering and terrorist financing. They have expanded to include combating fraud as well. Therefore, by strengthening AML measures, we can not only tackle money laundering and terrorism financing but also reduce the occurrence of fraud.

The Importance of AML

Anti Money Laundering largely encompasses the top 5 pointers

– Regulatory Action

– Threat Evolution

– Reputational Risk

– Poor Client Experience

– Financial Crime Persistence

The key to success will be close collaboration between authorities and the fin-tech sector in establishing a robust and agile regulatory system that fosters vigilance for the good of the economy and the people, yet promote innovation and growth within the fin-tech sector.

Look at the BIG PICTURE & Invest in a Compliant Future

Is there a wrong way to save money? Maybe not, but there is a wise way to save. Everyone loves saving money, cutting back, and reducing expenses. However, sometimes there is a tendency to focus on the wrong things.

Considering the bigger picture means thinking about how your actions can affect the overall success of a project or company aim, rather than focusing on minor details. Big picture thinkers see opportunities, and they are more able to inspire and motivate their teams to succeed.

One of the biggest challenges facing anti-money laundering investigations is the time it takes to reach any kind of resolution. To add, organized criminals use sophisticated and high-tech methods to keep up their illegal practices. There is also evidence to suggest that the existing techniques of tackling financial crime are outdated. For example, globally, thousands of people are part of a government financial crime blacklist and the total money laundered annually currently hovers 2% – 5% of global GDP. Given all of this, startups are working on artificial intelligence (AI) solutions that increasingly play a key role in helping financial institutions detect, tackle, and prevent financial crimes.

Are you being Penny-wise but Pound Foolish?

Do not ‘be afraid to spend on growth in the right direction. Do not skimp on making the right choices even if they cost more than what you budgeted for…these dimes invested wisely will save you a lifetime of fines and legal hassles. Being cost-conscious is always great, but if the returns are only short term, it best to re-strategize and make some leadership decisions, by investing in the right people and policies that will save a lot of heartaches and headaches in retrospect

Defiance through Compliance…Make the RIGHT Choice

More than ever, organizations are looking ahead to the future with a close lens and keen strategies. This type of big-picture thinking is imperative to the success of any company. It is time to become future-minded, pragmatic, optimistic and more receptive to the idea that the nearing imminent is morphing rather fast and it is better to stay on top of things and cultivate an adaptive mindset. Truly, if you stay hungry, you stay foolish!

Strategic foresightedness is the need of the hour…it is time to cultivate a culture of imagination and start thinking BIG, for Benjamin Franklin once aptly quoted, that “An investment in knowledge pays the best interest.”

AML is extremely important for the financial sector, as it helps to prevent money laundering, terrorist financing, and fraud. Companies that fail to comply with AML regulations face great fines and significant reputational damage.

Make the Right choice and engage Spicer Pegler Accounting & Auditing to manage your business. With over a decade in this field, SP offers the most accredited and the BEST of AML Services; Auditing & Assurance and Accounting and Bookkeeping, CFO Services are along the plethora of other superior services offered across the Middle East.

@SpicerPegler…Get in touch today and secure yourself assured Peace of Mind and a Compliance Business structure. Make the COMPLIANT Choice – Call us NOW!