Anti-Money Laundering and the Need for Effective Compliance Training
Money laundering is a very sophisticated crime and we must be equally sophisticated. – Janet Reno, while serving as Attorney General of the United States from 1993 to 2001
Although it is certainly not a new phenomenon, money laundering has become one of the most prevalent crimes of our time. Anti-Money Laundering (AML) is a constant priority for many organizations, and the level of vigilance required to prevent laundering is growing by the day.
In 2015, a record fine of $75 million was issued against a US casino operator for willful money laundering. Prior to this, the highest fine was just $10 million, so it’s apparent that law enforcement and regulatory authorities are developing increasingly tougher attitudes toward money laundering operations. Furthermore, it illustrates just how severe the consequences of money laundering can be for any business that engages in it.
Despite advances in technology and advanced security measures, organizations of all sizes are at risk, and the problems they face are exacerbated by a number of factors:
• Ongoing scandals mean that even fully compliant companies are under intense scrutiny, so they constantly need to increase Anti-Money Laundering measures.
• Multinational companies, in particular, are falling under the spotlight for their financial practices. Their ability to quickly and easily move funds from one jurisdiction to another is an obvious reason for this concern.
• International banks have been fined billions of dollars for non-compliance, including failure to identify and declare sources of funds. This has led to a change of attitude toward some banks, and the time is fast approaching where financial institutions are going to be treated as ‘guilty until proven innocent.’
Training Is Essential to a Good Anti-Money Laundering Program
New ways are constantly being created to launder money, but in response to this, new financial technologies (Fintech) and cybercrime regulations are evolving to detect these actions. It should be pointed out that these can detect both intentional and unintentional infringement of financial legal systems.
Increasing regulations and new compliance laws are being implemented that affect every industry. The banking and finance industry, in particular, is being affected by compliance laws and is under more scrutiny
So what can your organization do to ramp up its efforts to combat money laundering?
One of the most effective ways to protect your business is through good quality training.
4 Steps to Effective Anti-Money Laundering Training
Below are a few steps you can take to ensure your compliance training is on point and supports your AML programs:
1.Make it mandatory for all employees
AML training should be extended to all employees across your organization, as anybody can be the source (willingly or unwillingly) or the discoverer of money laundering activities within the company.
2. Ensure your training is current
Because regulations and laws are changing all the time, it is essential that you keep your AML compliance training up to align with current legislation. In order to fight money laundering effectively, your employees must have the right information and be aware of current laws.
3. Choose an engaging method of training
When choosing a method of training, it is essential to answer a number of questions first. What messages are you trying to get across in your training? What type of work do your employees do? Are they field-based or office-based? Would they appreciate short training modules taken over time as opposed to one full session of training? The answers to questions like these should dictate the type of training you chose.
Traditional classroom training mixed with new media technologies are being leveraged increasingly more for corporate training. Learn about different types of training you can use in this article.
4. Focus the training on practical application
The primary goal of your AML training (as with any training) is getting your employees to apply the knowledge and skills they’ve learned in their training to their jobs. Anti-money laundering is all about being proactive and alert so that the instances of the crime are detected and eliminated swiftly. Your training should encourage employees to be responsible, vigilant and to act fast whenever they suspect money-laundering.
Compliance Training Solutions
Interactive Services has a wealth of expertise in developing compliance training that help protect global organizations. We have developed Anti-money laundering training for many clients across different industries for more than 20 years.