What comes to mind when you hear Wolf of Wall Street, Lethal Weapon 2 or Netflix’s Ozark? No doubt, money laundering. While the big screen portrays money laundering as a glamorous and powerful art through high-speed chases and inevitable bad-guy shootouts, the reality is regulatory reform is here to stay.
So much so that a joint press release was distributed in October 2018 by the federal depository institutions regulators and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network. The release addressed instances in which “certain banks and credit unions may decide to enter into collaborative arrangements to share resources to manage their Bank Secrecy Act (BSA) and anti-money laundering (AML) obligations more efficiently and effectively.”
The Bank Secrecy Act, also known as the Currency and Foreign Transaction Reporting Act, is a U.S. law enacted in 1970 that requires financial institutions to file currency transaction reports (CTRs) for every transaction over $10,000 and suspicious activity reports (SARs) for suspected incidents of money laundering or fraud.
In December 2018, a consecutive statement followed, suggesting the use of innovative approaches to “combat money laundering, terrorist financing and other illicit activity.” Banks were encouraged to use new innovative approaches in conjunction with existing BSA/AML processes, such as adopting artificial intelligence or digital identity technologies to help advance risk compliance programs.
With the growing costs of operating compliant BSA/AML programs and U.S. Bancorp’s recent $613 million settlement with the U.S. Department of Justice for failing to have an adequate anti-money-laundering program, it’s no wonder shared resources and innovation are at the forefront in revamping a 50-year-old BSA/AML infrastructure.
Even MoneyGram, a global money transfer company based in Dallas, Texas, forfeited $125 million last year due to anti-fraud and anti-money laundering processes gone bad due to significant weaknesses in their AML program.Does your financial institution have the right internal controls in place to handle high-risk customers?
Stinnett’s financial services team can perform an independent testing of your BSA/AML program to evaluate its effectiveness in accordance with FFIEC guidelines. As part of the evaluation, our advisors conduct risk-based transactional testing and assess processes for identifying and reporting suspicious activity to ensure compliance with your organization’s policies, recordkeeping and reporting requirements.
Make sure the only path your paper and audit trail lead back to is a strong compliance program. Contact Stinnett’s financial team to learn more about helping your business comply with BSA/AML regulations.