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World Money Laundering Report

Andrew Janssen, a 37 year old man from Garland, Texas in the USA is hoping someone will stump up his USD50,000 bail. He can't do it himself after he was held on Wichita Falls on charges of money laundering and his stash of cash seized.

"The U.S. Department of the Treasurys (sic) Financial Crimes Enforcement Network (FinCEN) today issued a finding and notice of proposed rulemaking (NPRM), pursuant to Section 311 of the USA PATRIOT Act, seeking to prohibit the opening or maintaining of a correspondent account in the United States for, or on behalf of, ABLV Bank. FinCEN is proposing this action based on its finding set out in the NPRM that ABLV is a foreign bank of primary money laundering concern," says an e-mail from FinCEN. FinCEN says there are links to North Korea and the case is a warning to all banks that do business with NoKo or representatives of its regime. But the USA is mightily cross at links with several other countries with which relations are souring.

A report in the Vancouver Sun details the amazing failure of a project called "Statistical Analysis Software", currently in its fourth year and so far costing CND7.3 million, to design and implement money laundering risk identification and assessment software at the British Columbia Lottery Corporation's casino business which is deeply embroiled in money laundering investigations by the RCMP. It's a case study in how to stuff up = and now questions relating to the software and its failure are being added to the investigation.

There's much jargon flying around in the world of counter-money laundering. It starts with the mistaken name of "anti-money laundering," via the equally erroneous "red flags" to the current vogue terms of "artificial intelligence" and "machine learning." As FinTech and RegTech have passed their media bubble phases, the next wave is so-called "AI AML."

Think about this: when you install any form of AI, you are outsourcing to the software providers the function that the law requires that your staff perform.

Before you even meet the representatives of the start-ups that want to either bolt onto or supplant your existing technology provider, there are several questions you must ask. Here they are.

According to a report in Business Insider, Mark Hayward, CEO of National Association of Estate Agents told the newspaper that “Fines are not publicly being made known but, anecdotally, we know they are significant,” The Money Laundering Regulations 2017 are at the heart of the HM Revenue and Customs action but The Criminal Finances Act also comes into play. The report refers to "fines" of "millions."

India's Enforcement Directorate (ED) is involved in a rapidly increasing number of cases where money laundering is alleged and it is not afraid to go after high-profile, well connected, targets. But the latest case to gain publicity is even more sensitive than others. And the ED is finding itself the target of unwelcome attacks by some of India's most powerful people.

India's Directorate of Revenue Intelligence has had a string of successes of identifying cash couriers and confiscating large sums at borders. The methods used by the carriers are instructive.

One would think that when the New York Department of Financial Services, known for massive penalties against foreign, especially European banks, to say nothing of "perp walks" and heavy handed and highly prejudicial media statements, announces a penalty of USD60 million that it's for lightweight failures. Nothing could be further from the truth and the reality demonstrates why negotiated settlements are nearer to bribes than to justice, says Nigel Morris-Cotterill.

Across the media and social media in the past few days there has been widespread reporting that the USA's Office of the Comptroller of the Currency has "fined" Citibank. Just one small, technical detail. It's not true. Here's what did happen, and why, it is important.

In this conference paper, presented in Singapore on 31 July 2003, Nigel Morris-Cotterill looked at the then novel concept of Enhanced Due Diligence.

In the 2017 Tax Reform Bill, two major changes to the corporate tax structure will mean Financial Crime Risk Officers will need to scramble to understand how to handle US corporations and to re-write systems, says Nigel Morris-Cotterill. Christmas holidays are at risk if financial services businesses and advisers are to be ready for the new rules many of which will come into force on 1 January, even if PoTUS Trump has not signed the Bill into law by that date.

US President Trump has been looking for a win: for almost a year, the Senate has frustrated his legislative ambitions. His Bill to make fundamental changes to the USA's income and company tax structure was expected to be the next big failure. Instead, it has sailed through both Houses, but its final signing into law will be delayed due to "a procedural issue," although the result of that is a formality in favour of it being passed. Once in place, it will mean the biggest revision of the US Tax Code for more than 30 years. Some of the changes mean that MLROs etc. overseas will need to revise their policies.

Closed registers of shareholders and directors of companies, and company registers where the identity of shareholders and/or directors are not collected, have long been recognised as vehicles for financial crime. However, while governments are anxious to trace moneys relating to tax evasion (and, for political reasons, tax avoidance), to say nothing of money laundering and corruption, there are, in some cases, valid reasons for maintaining secrecy. As babies are, en masse, being thrown out with the bathwater, it's worth remembering what those reasons are.

It seemed like it was all over bar the shouting, or to be more precise, the haggling. Commonwealth Bank of Australia, CBA, admitted to the vast majority of the almost 54,000 failings listed in the civil penalty proceedings and in doing so entered what amounts to a plea in mitigation. AUSTRAC's response? To immediately file a further 100 allegations. That's just hostile litigation tactics and bordering on the malevolent, writes Nigel Morris-Cotterill, a former litigator.

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