Money laundering has been making headlines, with major European banks implicated in helping Russian criminals launder money. While this is a complex matter and all details are yet to be revealed, it is clear that the best practices for AML are not being followed.
Two factors in particular can prevent these kinds of scandals.
First, banks must exercise more diligence in their Know Your Customer duty. This is critical to understand the source of funds, the beneficial owners and the customer’s customer.
Second, banks need to perform more comprehensive transaction monitoring. Through this, unusual purchases of securities are detected and can be handled. With new machine learning capabilities, this instrument is very effective in preventing the type of transactions that seemed to occur in this case.
The directives on these matters are clear for all EU entities, and the lack of compliance in this case not only has led to a drop in share price and possible fines, it has also led to a loss of reputation.
FICO TONBELLER supports more than 1,200 banks worldwide, and our solutions check more than half a billion transactions every day. Our customers understand the need for improved money laundering detection, our consultants work with them to ensure they are set up to follow best practices, and our solutions make compliance easy. We are working hard to stop these scandals from occurring, and we encourage all banks to do the same.