Firms need to embrace technology to ensure robust anti-money laundering procedures

At the end of last year we predicted in these pages that the fine of € 98,000 in Bray's credit union by the Central Bank of failures of anti-money laundering control procedures would be "the end a very large area as the central bank points An absolute attitude toward the anti-money laundering (AML) control practices of financial institutions. "

With the announcement this week of a fine of 2.3 million euros taken from AIB for similar offenses, this prediction seems credible to say the least.

The growing demands of central banks around the world that banks have a "goal-oriented" procedure and counter-terrorism financial procedures (CFT) are getting heavier, but the resolution of regulators as a witness to The recent compliance action, seems clear. "In particular, we expect our retail banks, as gateways to the financial system, to establish systems and better controls against money laundering," said Derville Rowland, director of the central bank's application, in connection with the AIB case .

Similarly, the complex due to insufficient resources is unlikely to be heard with sympathy.

AIB was reprimanded and admitted six felonies under the Criminal Justice Act of 2010 (WASP and Terrorist Financing) (CJA 2010). Two flaws were highlighted: failure to report suspicious transactions and lack of due diligence (CDD).

Regarding the reporting of suspicious transactions, the flaws have focused on the acquisition of EBS in July 2011.

The Central Bank considered that "BIA did not apply adequate resources to ensure that warnings of possible suspicious activity (in a" delay "generated by its EBS activity) were promptly investigated and, if applicable, reported to the Garda and income Legal. Centralized unit of AML AIB, to investigate and report suspicious operations, took more than 18 months to fully process the backlog which at one time represented more than 4,200 notifications in circulation for more than 30 days. "

AIB was also unable to exercise due diligence (CDD) on clients who had accounts prior to May 1995 ("pre-95 clients") when the first Irish laws on money laundering and anti-money laundering came into force terrorism.



In fact, the two problems are related to each other. Suspicious transactions are most often the result of lack of due diligence and the second result of insufficient resources, but more relevant, ineffective, apply.

With the decision of the Central Bank and its determination to apply with punitive measures if obvious, banks and credit unions now have to re-evaluate the capital cost / benefit of sufficient resources deployed for the task. The cost of this equation can feel many managers.

But this does not have to be like this. Technology provides the answer, especially at the crucial stage of customer shipment.


In fact, the two problems are related to each other. Suspicious transactions are most often the result of lack of due diligence and the second result of insufficient resources, but more relevant, ineffective, apply.

With the decision of the Central Bank and its determination to apply with punitive measures if obvious, banks and credit unions now have to re-evaluate the capital cost / benefit of sufficient resources deployed for the task. The cost of this equation can feel many managers.

But this does not have to be like this. Technology provides the answer, especially at the crucial stage of customer shipment.