Strong risk assessment procedures ensure financial crime compliance – and prevents your company facing prosecution.
Much of the onus of fighting financial crime has been placed on the ability of businesses’ compliance procedures to identify risks.
By training staff to identify the risks, you will be fighting financial crime and ensuring your firm’s security.
The three main crimes
There are three main crimes that financial crime compliance procedures expose. All can be detected by sifting data, rigorously checking documents and background details, and questioning people in the know.
Money laundering and Combatting the Funding of Terrorism (CFT) are top of the priorities. Criminal gangs and terrorists try to make their ill-gotten gains legitimate by syphoning them through a series of accounts.
So it’s crucial to run in-depth KYC checks and ask questions that establish the identity of account holders, their relationships with third parties, the industry they are in, and where in the world their money comes from. These questions must not go unanswered.
Knowing where the cash stems from is also key to another of the big three – being sure that financial transactions do not to break UN and UK sanctions, such as those against Iran.
Then there are bribery and corruption procedures, which ensure a level playing field in business without unfair – and illegal – inducements. While it’s common for businesses to put all staff through bribery and corruption training, auditing helps ensure compliance and expose problems.
Like the fight against cyber-crime, financial crime officers’ techniques have to keep pace with the advances made by lawbreakers trying to take advantage of a company’s good name.
It's crucial to establish risk assessment procedures
A business which doesn’t establish risk assessment procedures and put financial crime compliance at the heart of its customer on-boarding process leaves itself open to possible criminal proceedings.
But those checks by AML/KYC Analysts are also useful in fighting financial crime that may inadvertently occur when a business expands or restructures, exposing any lapses in procedures that may have emerged.
The demands of all those checks vary from business to business and circumstance to circumstance, so it is useful to have seasoned professionals with wide experience asking the questions that could keep your company out of court.
Providing contract specialists experienced in compliance is a bedrock of Momenta’s business, due to our long experience in Know Your Customer (KYC) and Anti-Money Laundering (AML) practices.