- KYCC II – The New KYCC – Managing the Growing Money Laundering Risks of Corporate Customers description
- How to Keep the Explosion of Mortgage Fraud and Related Money Laundering Outside of Your Institution description
- "Look–Backs" – The Regulatory Rage That Is Making Financial Institutions Crazy (and Consultants Rich) description
- Closing International Correspondent Banking’s Money Laundering "Gateway" With Effective Due Diligence description
- How to Delegate Compliance Duties to Third Parties and Minimize Risks (But Not Lose Sleep) description
- Basic Training on Money Laundering and U.S. Legal Requirements, Part I – The Bank Secrecy Act and Its Regulations description
- Financial Intelligence Units Are Not Just for Governments; You Can Have One, Too, and Reap the Rewards They Do description
- Are Suspicious Activity Reports as Helpful as the Government Says? And, By the Way, Who is Looking at Them? description
- No Risk Left Behind – The ABC’s of Good AML Risk Assessment That Captures Major Risks description
- Leveraging Case Management Best Practices to Improve Compliance Controls and Productivity description
- Moving–on: Maintaining Your Gains and Rationalizing Your Costs After Your AML Crisis has Passed description
- Gauging Your Future AML Heat by Close Monitoring of the United States Congress and its Committees description
- Protecting Your Customer’s Privacy While Feeding the Government’s Big Appetite for Customer Data description
- Pivots, Filters and Sorts – Spinning the Powerful Dials of Excel® for Amazing Support in AML Compliance and Law Enforcement description
- Keeping Employees Off Risky Ground by Tailored AML Training That Fits Their Roles and Risks
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- Key Lessons Insurance Companies Must Learn for an Effective AML Program and to Combat Major Risks
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- Basic Training on Money Laundering and U.S. Legal Requirements, Part II – The Criminal Money Laundering Laws, the "Atomic Bombs" description
- How to Insulate Your Institution from Government Sanctions Through Good "Quality Assurance" in Your AML Program
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- What Securities Dealers Must Do for Top–Level AML Compliance As Their Regulators Begin to Show Teeth description
- Achieving Examination Excellence With Best Practices That Regulators – in Any Country – Cannot Criticize description
- Under the Wire – The Emerging AML and OFAC Risk of "Cover Payments" and How Your Institution Can
Deal With Them description
- Improving Transaction Monitoring – and the Chance to Detect Money Laundering – By Capturing the Right Information
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- The Six Best AML Practices of Money Services Businesses
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- Risky Business: Five Steps to Identifying and Managing Your High Risk Customers description
- The Upside of Transaction Look–Backs: How a Transaction Look–Back Can Strengthen Your Overall AML/BSA Compliance Program description
- Unmasking Beneficial Owners of Corporations and Accounts by Attempting to Peel the Layers of Disguise description
- The (AML) Book of Revelation – Seven Signs Your Institution Is Headed for Regulatory Trouble description
- Street Smarts: Crucial Lessons Government Agents Teach in the Way They Build Cases description
- Managing U.S. and Non–U.S. Information Requests from Law Enforcement under Treaties, Subpoenas, National Security Letters and Patriot Act Section 314(a) description
- What a Money Transmitter’s State–of–the–Art AML Program Should Look Like description
It is now clear that corporations, especially "limited liability companies," in all the United States and in offshore havens, facilitate money laundering and hide beneficial owners. Layered tangles of shareholders, subsidiaries and nominees give launderers a handy vehicle and throw law enforcement agents off their trail. The corporate maze is constructed by a regular cast of characters – attorneys, accountants, trust managers, "asset protection" specialists and consultants. They create and dissolve shell companies to spread criminal assets and, potentially, terrorist funds worldwide. "Corporate formation agents," who now are prevalent on the Internet, appear as the corporate officers of record, open financial accounts and facilitate funds movements, all for handsome fees. The U.S. Senate Permanent Subcommittee on Investigations, the Financial Action Task Force, the U.S. Financial Crimes Enforcement Network and others have documented the laundering risks that financial institutions and professionals face. The FATF says "anonymity is a critical factor" that attracts criminals to corporations. A 2006 global survey of AML professionals found that recognizing risks of corporate structures is their number one compliance challenge. What are the controls you should have in place for your defense? Are there new corporate customer due diligence procedures that you should adopt? What can law enforcement do to better penetrate corporate facades? In this panel you will get expert guidance so you can deal effectively with Know Your Corporate Customer, or KYCC II, the sister of Know Your Customer’s Customer.
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In the last two years, the U.S. Treasury and Justice Departments have shown that the explosion in mortgage fraud makes it one of the greatest money laundering threats facing financial institutions, who can serve as victims and as participants. The U.S. Financial Crimes Enforcement Network (FinCEN) reports a 1,100 percent increase since 1996 in suspicious activity reports that cite mortgage fraud and related money laundering. The usual participants in those crimes are the same persons the Bank Secrecy Act classifies as "financial institutions" and calls "persons involved in real estate closings and settlements." Despite its warnings about mortgage fraud and laundering in real estate, the proposed regulation will require the sector to maintain an anti–money laundering program and report suspicious activity, has been stalled since April 2003. Mortgage brokers remain virtually unregulated without national licensing requirements and are rarely required by states to submit to background checks. In the face of this regulatory void, federal prosecutors and investigators have gotten into the act and have convicted dozens of people for mortgage fraud and money laundering. What are the risks that financial institutions face? How do you protect your institution from these risks? What is being done about this? Here, some of the few persons who have done something about this tell you what they have learned in real life cases and how you can protect yourself.
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It has become almost a staple of enforcement actions of U.S. regulators that the affected financial institution is required to conduct a retrospective review (or "Look–Back") of its transactions to determine if deficiencies noted in an examination are more numerous than what the examiners already detected. A common example of such deficiencies is transactions the institution did not report as suspicious, which the examiners felt should have been reported. Regulators are justifying look–backs as remedies for the failure to adequately monitor transactions, and require the institution to review past transactions that were conducted during a specified period ranging from, say, six months to several years to detect transactions that were suspicious and to report them presently. These reviews impose a huge financial and operational burden on an affected institution. It is not uncommon for an institution to face a bill of several million dollars from an outside consultant that is hired to conduct a look–back. In many cases it would be a lot less expensive for an institution to pay a civil money penalty than to incur the cost of a look–back and the resulting operational disruption. How do you minimize the impact of conducting a look–back? Should you do a look–back if you are acquiring another institution? How should you pick the outside consultant that will do the look–back? In this session, top experts guide you on this regulatory rage and explain how to manage one and minimize the impact on your operations.
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No substantial financial institution, including securities dealers, in any country can operate without correspondent accounts in other countries, especially in the United States and other major financial centers. Most international institutions that maintain correspondent accounts in the U.S. face costly new duties that are required under USA Patriot Act Section 312 regulations, which also cover mutual funds. The controversial regulations apply to new and "legacy" correspondent accounts. U.S. banks, broker–dealers and mutual funds must now exercise special due diligence on international institutions with correspondent relationships. Failure to do so can lead to severe sanctions and penalties and bad publicity, as recent regulatory sanctions against several prominent financial institutions have shown. For example, ABN Amro paid an $80 million civil penalty for lax controls and inadequate documentation about its correspondent banking operations, among other infractions. To avoid regulatory problems, some U.S. institutions have expanded their requests for information from non–U.S. correspondents and some of them have even closed the accounts of financial institutions in Latin America and other regions, leaving them without access to the U.S. financial system. What are the best due diligence and monitoring practices? What are the consequences of non–compliance with these regulations for U.S. institutions and their foreign correspondents? How should non–U.S. institutions manage the growing demands of their U.S. correspondents? What do the regulators expect? Here, a panel of experts will guide you on these and other questions and share valuable insight on how to ensure that your due diligence procedures meet regulatory expectations whether you operate in or outside the U.S.
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Outsourcing customer identification, transaction and activity monitoring and due diligence duties is convenient, saves money, and can even become a best practice if done the right way. If you want to outsource these responsibilities and maintain a robust anti–money laundering program there is much due diligence you must perform. The same way risk management is a vital key to a successful AML program, evaluating the risk of your agents, affiliates and subsidiaries who may perform the outsourced compliance duties can minimize your risk, decide the fate of your due diligence procedures and determine if you will encounter money laundering problems. You must ask yourself several questions: How safe is outsourcing despite its convenience? What are the risks I assume? How do I outsource these crucial compliance tasks safely? Are the money laundering and regulatory risks tolerable? What are the regulatory reprisals if the outsourced entity does not perform the job as the regulations require? What is the view of your regulators on the outsourcing of these duties? Do you have procedures in place to detect lack of due diligence on behalf of the outsourced third parties? What formal agreements should you enter into to increase your protection? The experts on this panel will guide you on these questions and teach you what due diligence you should perform on third parties to assure that they comply with the rules for which your institution is ultimately responsible.
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If you operate or do business in the United States, home of the most aggressive and punitive money laundering regulatory scheme in the world, you must know the regulations, how they affect you and how to comply. That is true whether you work in banking, securities, money transmitting, mutual funds, insurance or a government agency. If you do not know your regulatory duties, the consequences can be devastating. This is the first of a two–part series at the conference, based on moneylaundering.com’s acclaimed full–day seminar, that will help anyone who is new to the anti–money laundering field, or who wants a deeper understanding of the U.S. Bank Secrecy Act (BSA), the USA Patriot Act and the regulations. The 76 BSA regulations, which cover the full range of 25 or so industries subject to the BSA, affect everything from currency transaction reporting to the required elements of a customer identification program. This session will give you expert guidance and instruction on what the United States regulations, which include the rules enforced by the Office of Foreign Assets Control (OFAC), require, to whom they apply and how they work. You will acquire the basic know–how you need to keep your organization compliant and your career on an upward swing. Manage risks and safeguard your institution effectively with expert knowledge and guidance you’ll receive here. (The second part of this series, on Tuesday, will teach you how the potent U.S. criminal money laundering laws work and apply to you.)
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More than 110 countries’ national governments have formed financial intelligence units that are loosely grouped under the Egmont Group. They undertake a great variety of duties such as collecting and analyzing financial information and intelligence for their investigative and intelligence agencies for use in money laundering and terrorist financing cases. In some countries, such as in the United States, with the Financial Crimes Enforcement Network, and Canada, with the Financial Transactions and Reports Analysis Centre, FIUs are the principal money laundering regulatory body. In other countries the FIUs serve in an operational role and conduct the investigations, nourished by the intelligence and information they also gather. Using them as models, financial institutions can develop their own financial intelligence unit to undertake a variety of important duties. These include proactive mining and interpretation of large amounts of data that flow through the institution’s internal systems and the exploitation of external information sources. An important component of an FIU is a database system that is equipped to filter and manipulate data to determine patterns and identify the often faint tracks that accomplished money launderers and terrorists leave behind in their wire transfers, currency and structured transactions, international commerce and other financial maneuvers. An FIU can help you identify and manage risks and monitor, analyze and prevent operations and transactions. Here, industry leaders teach you how you can bring your AML compliance to another level with your own FIU.
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In 2006, for the first time, more than one million Suspicious Activity Reports were filed in the United States, at great expense to the financial institutions and businesses that filed them. That means that on average more than 4,500 SARs were filed every business day in the U.S. Millions more SARs are filed each year in other countries, numbers that will continue to grow as money laundering laws and regulations expand. Governments say suspicious activity reporting is the heart of their money laundering control systems and yet, in many countries, budgetary pressures have resulted in reductions in personnel. Under these circumstances it is fair to ask if anybody in the pertinent government agencies is really looking at the suspicious activity reports and following up on what they report. What does the U.S. government do with the hundreds of thousands of paper–based SARs that are filed? Are they really manually input by a Native American tribe in North Dakota? Where is the "highly–secure system" that the USA Patriot Act said must be "fully operational" by the end of 2002? Regulators demand that you file SARs or they will penalize you. They also tell you to fill them out correctly to enhance their value to law enforcement; but, give you no feedback. What happens to SARs after you file them? How does law enforcement use them? What should you do once the SARs have been filed? Here, experts guide you on these and other questions. You will learn how to improve the quality of your suspicious activity reporting and your chances that your regulators will not find fault.
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In the past several years, the Financial Action Task Force, the European Union, the United States, the United Kingdom and others have told financial institutions that a risk–based approach to money laundering controls is necessary. But these bodies have not guided the institutions on how to implement this approach. There is a strong need for listings of best practices. Because regulatory and reputational hazards lurk in many places, it is crucial that more than customers and operations be scored for risks. Risk scoring is now a vital part of AML risk management. Institutions must take a broader view and assess all the risks they face. U.S. examiners require a risk–based AML program that has examined the risks in all operations, business sectors, and departments of the institution. Usually, the first point of reference of a regulator in its review of a financial institution is the risk assessment that has been conducted of those elements. It is crucial that banks, broker–dealers, insurance companies, mutual funds and, yes, money services businesses, develop risk evaluation systems and show that they adequately and consistently assess all relevant risks. The interagency U.S. examiners manual focuses on risk and contains tips that make it easier to evaluate the risks of an institution’s money laundering and terrorist financing vulnerabilities. What procedures mitigate specific risks that an institution faces? How should an institutions’ overall risk be assessed? Learn how experts do it and how to take risk–based AML compliance to the next level.
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More than ever, financial institutions are faced with increased regulatory pressures and the demand to perform due diligence, as well as the challenge of finding and hiring quality anti–money laundering compliance investigators. It is becoming critical for organizations to find ways to reduce unnecessary processes, investigations and manual efforts while significantly improving the quality, controls and efficiencies of the compliance function. This session will cover: the need for objective risk measures; the importance of case management; the need to re–engineer process and structure and how to leverage technology and automation.
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Most anti–money laundering crisis remediation programs leave institutions with a myriad of new policies, procedures, processes, committees and people. Yet, without a thorough post–crisis AML strategy, AML compliance gains soon recede and the improved compliance culture that you hoped to build withers. The proven strategies that we will discuss will help you consolidate and sustain your AML compliance improvements by integrating them into a comprehensive governance, risk and compliance function.
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Who would have guessed that a seminal report documenting inadequacies in the money laundering controls of the U.S. Financial Crimes Enforcement Network and the U.S. Internal Revenue Service Examination Division would have been prepared by the U.S. Government Accountability Office, the "watchdog" of Congress, for the Appropriations Committees of the House and Senate in the U.S. Congress? The GAO report, released in December 2006, dissects major deficiencies in U.S. laundering controls and cites how they can be cured. The professionals who know how the U.S. AML regimen works and how AML pressure is generated on financial institutions keep an eye on Congress and its Committees. Congress is the source of all U.S. laws, including the Bank Secrecy Act, money laundering laws, and asset forfeiture laws. From the standpoint of the regulatory heat that institutions feel, it is the source of pressure on the regulators when a Senate or House committee questions their performance. The hearings and reports that committees produce serve as valuable AML training and guidance materials for financial institutions, but more importantly, they serve as harbingers of things to come in new legislation and regulations. The regulators listen closely to Congress because that is where their appropriations come from. The U.S. Congress is under new party control and its committees are led by different chairs who have their own priorities. This new configuration will lead to more "oversight" hearings that examine the operations of the agencies. These things affect you in crucial ways. How did the Congressional hearings of the Riggs Bank affair produce a great change in the regulatory atmosphere? Why is Congress the best barometer of the AML atmosphere in which you operate? Learn the answers to these questions and more in this unique panel of key Congressional persons and seasoned Capitol Hill watchers.
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In the past year, revelations about the wholesale disclosure of information about customer accounts and international funds transfers to U.S. intelligence and law enforcement agencies by financial institutions under the umbrella of SWIFT have put the U.S. government and the European Union on a collision course. Justified by the U.S. as a worthwhile effort to track terrorist funds, the flow of information from institutions that form part of the Brussels–based private sector funds transfer processing consortium has been massive. The EU has concluded that it violated its data protection laws and that fundamental rights must be protected. The efforts of the U.S. intelligence agencies sometimes conflict with the privacy and data protection laws of the European Union, Canada and other countries. There, institutions are subject to strict customer privacy and confidentiality obligations. They also must comply with regulations to prevent money laundering and terrorist financing. Is there a conflict in these duties? How can international institutions comply with the privacy laws of other countries while feeding the big appetite of the U.S. government for customer and transaction data? Are financial institutions vulnerable to customer lawsuits for breach of privacy? How should you handle requests for customer data from government agencies and financial institutions in other countries? How do you conduct the balancing act of cooperating with the U.S., not violating the laws of the EU and preserving the confidentiality of your customer’s financial affairs? Here, you get guidance on these questions and on how to walk that high wire.
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This groundbreaking session showcases Jim Richards, one of the most imaginative and creative anti–money laundering experts in the world. He will show you how a tool that is at your fingertips, Excel®, or similar spreadsheet software, can help you solve with amazing speed the money laundering riddles in customer transactions and investigative cases at your organization. We usually embrace new technology quickly without first understanding the old. You use Excel® in your job but do you use it well? Do you fully exploit its basic – and advanced – features that make it a powerful AML tool that should be in your arsenal? Jim Richards will give you invaluable lessons on using this dynamic AML weapon. He will teach you how to "spin the dials" to decipher the jigsaw puzzle your customers or investigative or due diligence targets attempt to paint. You will get invaluable time–saving benefits that you can apply in your AML work as soon as you return to a financial institution, non–financial business or regulatory, law enforcement or intelligence agency. Jim Richards will teach you the insider’s angles to Excel® and the many tips and tricks that he has learned over the years that will increase your productivity. If you have seen Jim Richards at one of our conferences you will agree that his innovative approach to money laundering controls make him one of the most valuable instructors in the money laundering field. You will not want to miss this fast–paced, entertaining session.
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A great risk that financial institutions and businesses face in the AML field rests with their employees. In assessing their overall money laundering risks in their products, customers and geographies, institutions must not ignore the risks their employees pose. Employees are the most important line of defense and an "enemy within" could bring severe damage to your institution. From the executives in the C–Suite to the branch tellers, it is important to determine their level of risk. Does a private banker who deals with high net worth individuals present a greater risk than one who works in international banking or funds transfers? What kind of AML training should the different types of employees receive? Is awareness training sufficient, as it might be for members of the board of directors, or is advanced training required for particular employees? By tailoring your training to the risks and responsibilities of your employees you can address their unique circumstances and maximize their effectiveness in your overall AML program. Some institutions tailor their training risks based on employees’ day–to–day activities, the lines of business they handle and their job descriptions. Others use "role–based" training, meaning they determine the appropriate training based on the role the employees play in the institution. In this panel, experts who follow the "tailored" approach to training show you the best practices in training your staff to ensure that your AML program is not found deficient by regulators in its training component.
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Since May 2006, the United States life insurance industry has faced Bank Secrecy Act regulations requiring each company to maintain a four–pronged anti–money laundering program and to report suspicious activity. As a newcomer to the AML regulatory field, life insurance companies are struggling with little guidance or clarity of what is expected of them from the Financial Crimes Enforcement Network or the Internal Revenue Service, which is charged with examining them for compliance. The unique characteristics of life insurance companies, including the lack of a federal regulator, their use of independent agents to sell their products and the payment methods they use make the creation of a sound AML program a challenge. Some insurance companies have made big strides in implementing AML controls. But others are not so advanced. The IRS has barely begun to plan its examinations and has issued no guidance to the industry on what the exams will review. What lessons can you learn from the companies that have implemented the rules? What best practices have emerged? How can company–wide compliance be assured? What works and doesn’t work in training independent agents, as the regulations require? How does the industry deal with 50 state regulators that interpret federal AML regulations non–uniformly? Should a company comply with OFAC regulations at the independent agent and third party administrator levels? Here, you will get guidance to those questions and learn what some companies have done to achieve top–quality AML compliance.
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In 1986, the U.S. became the first country in the world to criminalize the "laundering" of proceeds of criminal activity when it passed U.S. money laundering laws. Since then, the U.S. Congress has increased their coverage, reach and scope, making them the broadest, strongest and most far–reaching money laundering laws worldwide. With "extraterritorial" provisions and court–imposed "willful blindness" doctrines, the laws represent the most lethal risk that you or your institution anywhere in the world can face. The USA Patriot Act broadened the scope of the law to include a wider range of financial wrongdoing, including foreign public corruption proceeds and terrorist financing, as prosecutable offenses. Knowing how these laws work is crucial to the success of the money laundering controls at your institution. It is surprising that many financial institutions do not cover the ins and outs of legislation in their AML training. This session is your chance to remedy that and to hear top experts teach you how the law works, how U.S. government investigators and prosecutors can use it against you and your institution, and how to avoid becoming the target of a criminal money laundering investigation. They will also teach you how these laws reach persons and transactions around the world and how the U.S. government can seize accounts, money and other property that are tied to the criminal activity.
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You spend countless hours and a lot of money developing an anti–money laundering program at your institution, including the preparation and implementation of policies and procedures, the hiring of qualified personnel, and the maintenance of training and customer identification programs and more. How do you assure that the AML program is working well and is as "bullet–proof" as you can make it to the criticisms of regulators, auditors, and, heaven forbid, prosecutors? Some financial institutions have created quality assurance, or internal testing teams, within their AML units. These teams seek to ensure that the policies, procedures and programs are working properly and meet regulatory standards. Before regulators uncover deficiencies, quality assurance teams "kick the tires" of an AML program to see if gaps exist and alert the AML officer to problems and weaknesses that need attention. Small or large institutions may use these specialized teams. They provide a measure of preventive protection that guards against regulatory problems. In effect, they serve as an insurance policy by providing protection that ensures that your processes are sound, efficient and effective. Here, experts who have formed or manage these teams tell you why you should have one, how to form it, how they work in conjunction with your internal auditors and how to find the right people to fill the roles.
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The U.S. securities industry has begun to feel the regulatory pressure that banks have felt for 20 years. Recent enforcement actions by the National Association of Securities Dealers and the New York Stock Exchange, as well as the Financial Crimes Enforcement Network against large and small broker–dealers have made it clear that securities regulators can bite as well as bark. Now, with the imminent merger of the regulatory functions of the NASD, which has become an active BSA regulator, and the NYSE, another imponderable has come into the picture. How will that change the AML regulatory landscape for securities firms? Securities dealers must maintain adequate AML programs and report suspicious activity, both of which have been required since 2002. Their compliance with industry–specific Bank Secrecy Act regulations, as adopted by the Securities and Exchange Commission, and obli gations, like OFAC regulations, are examined by the SEC, NASD, NYSE and other "self–regulatory organizations." What should broker–dealers do to assure that their AML programs meet top regulatory standards? Since their regulators do not publish their examiners’ manuals, as the banking agencies do, can they learn useful lessons from the bank regulators’ manual? What is a good AML training program for securities dealers? Here, regulators and industry experts give you the knowledge a securities firm needs for top–level AML compliance.
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Regulatory examinations in all countries are work–intensive and stressful for the employees of the examined institution and for the AML specialists who perform AML functions. Thorough preparation can go a long way toward assuring your survival and your sanity during and after the examination. To avoid poor reviews or regulatory sanctions there are tools that can mitigate those risks. Examiners look at many facets of an AML program including consistent implementation of its various elements, employee training, transaction and suspicious activity reporting, due diligence procedures, and tailored risk identification and management. In the United States, the unique interagency Bank Secrecy Act/Anti–Money Laundering Examination Manual of the five banking agencies is an invaluable aid for financial institutions to check that their programs are what examiners expect. It provides a roadmap not only for banks but for all types of financial institutions worldwide. Institutions can also benefit from dissecting enforcement actions against other institutions, which give a clear picture into the present remediation priorities of the regulators and clues about what examiners are looking for in their examinations and where you might go wrong. In this panel, you learn how to prepare for an examination and the best practices for your compliance program to keep it out of harm’s way. Experts give you the knowledge you need to develop a stellar AML program that will pass examination muster and meet regulatory expectations.
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Recent enforcement actions against ABN Amro and Banco de Chile highlight regulatory concerns about the use of cover payments by international banks. Cover payments are funds transfers that involve two distinct payment message streams. These "payment messages" often do not identify the originator and beneficiary of the transfer in the payment order sent to correspondent banks involved in the payment. That exposes them to the risk of unwittingly facilitating the international movement of money destined for terrorism, for laundering motives or for the benefit of a person listed on a sanctions list maintained by the European Union, the U.S. OFAC or other body. The payments can not only mask the involvement of sanctioned parties in a transaction but also prevent financial institutions from adequately monitoring for and reporting suspicious activity. Cover payments are used in international funds transfers because the originating and beneficiary banks often do not have a relationship that allows them to settle the payment directly. In cover payments, the information from the first leg of the funds transfer, including the identity of originator, the originating bank and the beneficiary, is not provided to the intermediary bank that receives the second funds transfer. Therefore, intermediary banks cannot determine if the payment indicates possible illicit activity. This panel explores how institutions best manage the risks in cover payments and what information–gathering procedures they use to minimize the risks.
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Most financial institutions and businesses have transaction monitoring systems as part of their anti–money laundering programs. But they still face uncertainty about what is expected of a good transaction monitoring system and how they can maximize its utility and return on investment. The software you choose can be very expensive and challenging and regulators are now taking a tough approach concerning transaction monitoring. The last thing you want to discover after you have completed the arduous task of selecting and implementing transaction monitoring systems is that it does not work the way you thought it would. This happens sometimes because the systems are not configured and set up to capture the correct data to identify potential suspicious or illicit activities. Software systems are only one part of the equation. The human factor is important in the analysis of the data these systems produce. In this panel you will learn how to reach the goal of extracting from your monitoring system the right information and minimizing alert overload. You will also learn how to use the data you receive to its fullest through effective case management. How do you ensure that your system is seeking the right data? What should you do with the data you receive? How should you manage investigations into suspicious activity using your systems? Top experts share their knowledge and guide you on how to implement and combine technology–driven AML programs to get a good return on investment.
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Over the years money services businesses have been disproportionate targets of investigations and adverse regulatory action in the United States and other countries. Some critics of that targeting say it is because their transactions are easier to decipher by government investigators compared to the complex ones conducted by securities dealers, who have escaped the harsh actions that have befallen money services businesses. Money transmitters, check cashers and other MSBs have struggled in recent years to overcome the effect of being labeled, sometimes by regulators, as "high risk" businesses. MSBs in the U.S. are required to maintain an AML program, report suspicious activity, register with the U.S. Financial Crimes Enforcement Network, obtain licenses from the states in which they operate, maintain an OFAC compliance program, among other AML obligations. MSBs have an added risk of dealing with their agents in other countries whose credentials and bona fides are often difficult to verify and monitor. Some MSBs have succeeded in implementing anti–money laundering programs that keep them out of trouble with regulators. But many of them, despite their best efforts at maintaining good AML programs, have seen their bank accounts, without which they cannot operate, closed. In this panel, you will learn the policies and procedures maintained by MSBs that have avoided regulatory problems and kept their bank accounts. The experts on this panel will provide you with valuable lessons learned from years of experience and share best practices with you.
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Institutions are increasingly required to demonstrate that they have an effective program in place that first identifies and then appropriately manages those customers that are considered higher risk. This session describes five critical steps to ensure your program successfully brings together the requirements of knowing your customer, conducting due diligence, enhanced due diligence and customer risk rating while preserving the customer experience. A case study of how BB&T is implementing these capabilities across multiple channels will illustrate how risk–based procedures and technology combine to deliver an effective solution to this growing challenge.
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The panel will facilitate discussions on how regulators have been requiring institutions to implement transaction monitoring look–back projects to remediate any shortcomings in their Suspicious Activity Reporting programs. Also, how look–backs often entail reviewing the universe transactions that have passed through the institution for time periods ranging anywhere from six months to three years. Conducting a look–back is a monumental undertaking that provides financial institutions a unique opportunity to deepen its understanding of its overall money laundering and terrorist financing risk, while at the same time, lessening the likelihood of stringent regulatory actions in the future.
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Criminals use many strategies to disguise their laundered funds but the Financial Action Task Force says the most effective way to thwart a laundering scheme that uses corporations and offshore accounts is to identify the beneficiary of the transactions. It is clear now that financial institutions in the U.S. and other countries are not obtaining information about the beneficial owners of the corporations and trusts that seek to establish an account relationship with them. The FATF defines beneficial owner as the person who "ultimately owns or controls a customer and/or the person on whose behalf a transaction is being conducted." Identifying these individuals masked behind layers of corporations, shareholders, lawyers, nominees and other intermediaries is difficult. Those layers obfuscate the transactions and the principals and nominees who conduct them. They create a roadblock to law enforcement investigations and expose institutions to laundering abuse. Lax incorporation requirements in U.S. states, such as Delaware and Nevada and even New York and Florida, and in offshore havens, which promote incorporation by non–residents and require no beneficial owner information, make identification efforts difficult. What do regulators expect financial institutions to uncover? Is it possible to pierce the veils of secrecy that corporations and trusts provide? How do you deal with countries – and U.S. states – where there is little transparency in beneficial ownership? Here you will learn how you can attempt to identify the true beneficiary of corporate accounts and transactions that do business at your institution.
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As gray clouds precede a storm the run–up to adverse regulatory actions usually includes signs and red flags that foreshadow trouble. Ignoring the signs can throw your institution or business into a downward spiral to regulatory nightmares, reputational loss and monetary penalties. There are ways to detect impending regulatory sanctions and penalties. Detecting them early in the process can help you avoid disasters that can even lead to stockholder lawsuits against the members of the board of directors. Real life cases that other institutions have suffered can teach you many lessons and provide useful signs that will tell you where others went wrong. If those signs tell you that you’re going down the same path you need to take prompt action either by fine–tuning your AML processes or taking more drastic steps. In this panel, you will learn the lessons that have flowed from some of the more noteworthy and instructive cases of the recent past. They are lessons that you can adopt. They provide a roadmap of what to do and not to do. Seasoned experts on this panel will analyze and extract the lessons of important cases and teach you the red flags that you should always keep before you. They range from the proper monitoring of your employees’ activities, to tracking dirty money from international money services businesses, to verifying information about international customers. The principles from these cases usually lead to tougher examinations and stiffer penalties for other institutions.
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If money laundering is occurring in your financial institution, it is crucial that you detect it before the government does. To do so, you need good investigative skills. There is no better way to learn those skills than through real money laundering cases and the government agents who conducted them. They know how money launderers and other financial criminals operate, what records provide the most helpful information and how you should analyze them. What kind of information is useful? How do you get that information? How should you interview a witness, subject or employee? Criminals are innovative and exploit weak links in your institution’s products and procedures. Knowledge of how the criminal mind works, how money moves, and how to follow the money, will be an invaluable asset in your internal investigations. If you are in law enforcement, learning new techniques can be a boost to your productivity. Here, three experts show you how to identify and trace illicit money flows using real–life scenarios. You will learn valuable case management techniques that will help you identify and, sometimes, block illicit funds from entering and leaving your institution. Top investigators, who have followed the money in many kinds of laundering cases, will teach you how to detect and track suspicious money trails.
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If your financial institution receives a request for information from a government authority, such as a subpoena or, in the United States, a Section 314(a) request through the Financial Crimes Enforcement Network, incorrect or improper handling of the request or the delivery of the requested information will cause problems with investigators and, sometimes, your regulators. Non–U.S. financial institutions that keep correspondent accounts in the United States must answer to subpoenas from U.S. authorities or risk having their accounts closed. U.S. financial institutions are required to have policies and procedures concerning their compliance with requests for information from law enforcement agencies. What you do when you receive one? Do you close the account of the person who is the subject of the information request? Distinguishing between different types of requests can be confusing. You must know how to respond to them, when to seek the advice of legal counsel, and, in general, what procedures best protect your institution. If you are required to appear before a grand jury what do you do and say? This workshop will guide you on how to perform your duties to law enforcement agencies and prosecutors and avoid problems with regulators. Here, experts analyze real–life cases and teach you what to do when the government knocks on your door.
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If there is one industry in the AML universe that has spent more time under the regulatory microscope than the money services business sector it would be difficult to identify. MSBs have struggled with the taint of being labeled by government agencies as a high–risk customer for years. They have tried to convince regulators and banks that they have the proper controls in place. Building a compliance program for an MSB is not easy but is imperative if it is to function in the United States. This workshop will probe real–life scenarios and provide you with a checklist of the steps you should take to build a state–of–the–art AML compliance program. You will get pointers on what external resources you can use, such as the interagency U.S. bank examiners’ manual, to capture the essence of good AML procedures that will help your MSB improve its chances of avoiding regulatory problems.
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