How Money Laundering Is Being Stopped By AML Compliance
- Author Elizabeth Wilkerson
- Published March 23, 2013
- Word count 577
Money laundering is a serious offense. Just how law enforcement is better able to combat money laundering is through the assistance of banks and financial institutions. Keeping track of certain monetary transactions is the responsibility of these financial institutions under the current laws. Those who are required to follow these laws will need to have an Anti-Money Laundering or AML Compliance Program in place to ensure the record keeping requirements are done appropriately.
The image developed by the term money laundering is pretty straightforward. It is the process of turning "dirty money" into "clean money". Dirty money is obtained from criminal activity like drug trafficking, terrorist activities or other crimes. Furthering this criminal activity, dirty money is incorporated into the legal financial system. Three steps are needed with basic money washing. Legal banking institutions first obtain this illegal money confidentially. Placement is the term for this procedure. Shifting the money around is the second step, where difficult to trace wire transfers move the money from place to place. This step is called layering. The third and final step is moving the money through the various banks until it is what they refer to as clean. This last part is known as integration.
Although it is impossible to figure out exactly how much of the global economy is involved in money laundering, some organizations have estimated that it is somewhere between two to five percent. Likely somewhere in the billions is the amount of US money that could be a part of this laundering. With this substantial threat to legitimate monetary transactions, governments have sought to criminalize money laundering and to discover it so that those responsible can be charged.
The Bank Secrecy Act or the BSA was put into law by Congress in 1970 in order to combat this illegal activity. The BSA set up certain specifications for recording keeping of money and the reporting of certain transactions by banks, financial institutions as well as private individuals like brokers. Under the Bank Secrecy Act, those subject to the law are required to report cash transactions which are over $10,000 though a Currency Transaction Report and to keep a paper trail of such financial transactions. Anyone participating in such large transactions must also be identified by the banking institutions.
The Financial Industry Regulatory Authority or FINRA, in order to put into action such requirements has established a specific guideline that all banks and financial institutions create what is called an ALM compliance program. FINRA Rule 3310 requires that member institutions establish a compliance program that can detect and report the transactions required under the Bank Secrecy Act, that has sufficient internal procedures and controls to ensure compliance, to provide compliance testing on an annual basis by an outside third party, to designate and identify to FINRA the people who are responsible for the compliance program, and to provide the appropriate employees with ongoing training to ensure compliance.
Besides being required by law, those subject to the Bank Secrecy Act must abide by or their professional reputation would be in jeopardy. AML compliance can seem daunting at first but there are a number of resources available to help those that need to comply to implement programs that are sufficient under applicable laws and regulations. Talking to a professional who can determine whether or not your required to comply to such laws will be a great help and the expert is also able to help set up such compliance applications on your behalf.
If you are looking to obtain an AML compliance manual, Chartwell Compliance can supply you with it. For additional info on Chartwell Compliance, check out their site at http://www.chartwellcompliance.com/.
Article source: https://articlebiz.comRate article
Article comments
There are no posted comments.
Related articles
- Fintechzoom IBM Stock: Powerful!
- Building a Professional Website on a Budget: Using Free Tools like WordPress and AI
- Navigating Vietnam's Tourist Immigration: Challenges and Solutions
- Bitcoin FintechZoom
- Google SEO Updates 2024 Jackyan
- Cost-Effective Gardening: Tips for Enhancing Your Garden on a Budget
- Steve Wozniak: WOZ
- Keeping Your Garage Door Running Smoothly: A Guide to Drum Replacement with GarageDoorMagnolia
- When Your Garage Door Goes Rogue: Off-Track Repair in Tacoma and Seattle
- Same Day Service? Kiki Garage Door Repairs Your Garage Door Fast in Sammamish, WA
- Cost-Effective Strategies for Business Owners in 2024: Maintaining Efficiency Without Reducing Staff
- Navigating Compliance for Personal and Professional Contributions
- Smart Savings: The Benefits of Buying Out of Season
- Youtube To MP3 Converter -- Free
- The Benefits of Outdoor Training
- A Fashionable, Artistic, and Modern Adventure: Three Days in Paris
- Why buy stock footage on mediaCastpro? Here are the benefits.
- GoPDF An Online PDF Editor Releases Mobiles Apps Compatible with iOS & Android: A Faster Solution for PDF Editing
- The Best AI Logo Generators in 2024
- How to prepare for a house clearance, a few tips from experts
- Adapting to Rising Parcel Rates in 2024 with Business Central and Order Ship Express
- Not All LED Lights Are Created Equal
- Zoviz Launches New Solutions Day by Day to Users as An AI Logo Maker
- Campervan Maintenance: All You Need to Know
- Fighting the Silent Epidemic: Safeguard Your Child's Future with Vitamin D Screening at KinderCure | Dr. Garima Mengi
- 5 Inspiring Stories of Women Who Achieved Gorgeous Lashes with Careprost Eye Drops
- Is Your Finance Strategy Ready for ERP Software?
- A Beginner's Guide to Starting a Career in Web3
- The Vital Role Of The Courier Industry: Connecting People, Businesses, And Communities
- Learning From Successes And Setbacks: The Importance Of Post-Bid Analysis In Professional Bid Writing