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ReadersSpeak

AML enforcement fines at all-time high regulatory standards.
W e wish to thank Martin Cheek, vice president of Kroll, the most common failings cit-
Over the past five years, according to

ed when issuing fines involve AML
SmartSearch, a provider of an anti-money laun-
activity
suspicious
management,
dering verification service, for this commentary:
due diligence. Each of these is central
In 2016, $889 million worth of fines were levied globally to institutions that monitoring and customer standard
failed to adhere to anti-money laundering and sanctions laws. The same year to successful AML strategy—without
also saw nearly $7.5 billion in fines issued for bribery—and it's a safe bet that them, institutions are vulnerable to
wherever bribery exists, there is also money laundering to ensure that funds money launderers.
remain hidden from authorities.
In addition to large financial insti-
In 2020, the numbers were vastly different: $2.22 billion in fines for money tutions, small businesses can be a
laundering, compared to $2.42 billion for bribery. The first six months of 2021 popular choice to launder money be-
saw $994 million in fines assessed over 17 actions. Large AML actions in 2021 cause many of them lack resources to
included $390 million against Capital One for violations of the Bank Secrecy conduct thorough background and
Act and $100 million against cryptocurrency platform BitMEX in a settlement sanctions checks—and because, as
with two U.S. regulators. small fish in a large pond, they're not
usually the focus of investigations.
Authorities around the world are cracking down on money laundering—a This increases pressure on business-
good thing. But if you break down the numbers further, the picture isn't as es large and small to have AML and
rosy: the number of fines issued for money laundering was the same in 2019 sanctions protocols in place to protect
and 2020, yet only $444 million worth of fines were issued in 2019. As Kroll, themselves should someone try to
the company that compiled these figures, noted, the total value of fines rose take advantage of this lack of over-
because of "numerous substantial fines by Nordic regulators." Thus, it's not sight.
necessarily that governments are more aggressive about investigating money
laundering—they're instituting harsher punishments for failing to meet Thankfully, AML compliance is now
easier than ever. Artificial intelli-
gence reduces check times to seconds
and frees staff from referencing each
new customer against hundreds of
sanctions lists. Additionally, more
sophisticated platforms provide sus-
picious activity monitoring, so if a
client lands on a sanctions list, busi-
nesses won't be caught unawares.

Money laundering is a perennial
concern worldwide. Not only do the
assets involved usually stem from il-
legal activity, they can often be fun-
neled back into criminal enterprises,
making it difficult for law enforce-
ment to police them. Yet, despite the
obvious threat money laundering
poses to stability and the rule of law,
many see AML regulations as red
tape making it more difficult for busi-
nesses to operate effectively. The op-
posite is true. Using appropriate AML
technology, businesses can go about
their work, secure in the knowledge
they are protected.

Do you have knowledge to share?
Please send your commentary or ques-
tions to greensheet@greensheet.com.

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