Banking
Next Generation AML/CTF screening and monitoring for financial institutions
AML Bank Money Laundering Screening Solutions
Money laundering is a crime that has been present in financial institutions for hundreds of years; however, given the advances in technology, there has been a rise in its scale and prevalence. The internet and cloud computing have given people the ability to access their financial information from almost anywhere; however, this also makes banks, credit unions, and other financial organizations susceptible to criminal activity.
Money laundering allows criminals to exchange dirty money inconspicuously. While the occasional brick and mortar bank robbery still takes place, the rising amount of online activity, combined with the prevalence of cryptocurrencies (such as bitcoin), has made detecting online money laundering more difficult.
Truth Technologies is one of the leading global risk compliance platforms in the world. Truth Technologies is dedicated to guarding businesses across all industries against money laundering crimes. Learn more about how we can help you detect money laundering in financial institutions and prevent it using our novel detection tools.
We help institutions across the banking sector:
Retail Banks
Commercial Banks
Central Banks
Community Banks
Saving & Loans
Challenger Banks
Credit Unions
Investment Banks
Money Service Business
What is Money Laundering?
Money laundering is a process by which individuals or entities hide illegal funds by disguising where they come from. In terms of financial institutions, such as banks, this is typically carried out in three distinct steps. These include:
- Placement: During placement, the money launderer will place the dirty money into a legitimate financial institution, such as a bank
- Layering: During the layering process, the origin of the money is concealed using multiple transactions and bookkeeping tricks, making it undetectable
- Integration: In the final step, the laundered money is then withdrawn from an integrated, legitimate account, where it is used for whatever the criminal wants or needs the money for
This entire process, from start to finish, can happen quickly. There are several reasons why money launderers target large financial institutions, such as credit unions and banks.
Why Financial Institutions?
There are a few reasons why banks are susceptible to money laundering. These include:
- Large Sums of Money are Normal: Banks are vulnerable to this activity because they handle large sums of money on a regular basis. What is seen as a large amount of money to a criminal might go totally unnoticed by a bank. This makes money laundering hard to detect.
- Customer Service: The financial world is a competitive field. Banks and other financial entities work hard to get customers to deposit their money. Then, banks can use this money (legitimately) to invest in real estate, businesses, and the stock market to earn returns for their shareholders.
- Cryptocurrencies: The rise of cryptocurrency has made it harder for banks to track all of the financial activities that take place under their umbrellas. This makes it easier for people to commit money laundering.
Large cash flows will regularly go unnoticed and people can have multiple accounts with a single bank. Deposits might even take place in relatively small amounts, making abnormalities even harder to detect.
Rules and Regulations Surrounding Banks and Money Laundering
There are a few initiatives that have been introduced to try to reduce the frequency of money laundering that takes place through banks and other financial entities. Some of these include:
- Banks are required by law to report large cash transactions (typically over $10,000) and any other activities that might appear suspicious
- Firms need to comply with the Bank Secrecy Act and implement all of its regulations under the title of “anti-money laundering rules)
- FINRA Rule 3310 sets forth a set of regulations with which all banks must comply, including:
- The bank’s anti-money laundering program must be approved by a senior manager
- It needs to be reasonable to detect money laundering activity
- It must comply with all of the government’s anti-money laundering rules
- Ongoing training must take place for all personnel
- Each firm must have a contact member that FINRA can reach out to when necessary
- These regulations have been put in place to try to reduce the frequency with which money laundering takes place.
Red Flags for Money Laundering in Financial Institutions
There are a few red flags in banks that might indicate money laundering is taking place. These include:
- There is an unexplained, large investment from a third-party that isn’t connected to any other institution
- A large cash deposit was made that is not consistent with the socioeconomic status of the person involved
- It is challenging to figure out who carries out what role in a business that has an account with the bank
- The business is incredibly successful operating in high-risk countries
- The business operates mostly through cash transactions
If money laundering is taking place, there are steps the financial institution can take to protect itself.
High-Quality AML Screening with Truth Technologies, Inc. (TTI)
Truth Technologies is one of the leaders when it comes to global anti-money laundering (AML) measures and screening technologies. Specializing in anti-fraud, AML, customer identification, and compliance, Truth Technologies is run by a team of highly trained and experienced professionals from financial and information technology backgrounds. Some of the benefits that come from working with TTI include:
- Improved compliance with US, Canadian, and EU privacy and AML regulations
- User-friendly interfaces which include CTR and SAR reporting, APIs, and batch screening
- Versatile integration and maintenance with improved due diligence technology, automatic reporting, efficient updating, and batch processing
- Operational on an international scale with global watch lists and multiple languages available
Invest in Improved Security with Truth Technologies Today
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