Anti-Money Laundering (AML) Checks; The Lowdown

Anti-Money Laundering checks is a broad term applied to define checks conducted as a portion of the UK’s Anti-Money Laundering regulatory framework. An AML can be a check on a person carrying out a specialised role, or an organisation supplying goods or services.  The official structure comprises of various distinct Acts and Regulations and differs from nation to nation depending on the laws and legislations the land has in place. The UK law makers are frequently recognised to pursue regulations that aim to counteract, identify, and report money laundering pursuits. This is in an effort to deal with the ever-increasing concerns encompassing criminal activity, terrorism, extremism and profits of corruption. In that sense, the UK Government have succeeded in detecting various vital segments that may be prone to money laundering and ought to take the lead in advocating for best practice and greater regulation within corporate organisations. This is comprehensive of a number of legal and fiscal sectors.

Why are Anti-Money Laundering Checks (AML) Necessary?

Anti-Money Laundering checks intend to generate alterations in the notion adjacent to money laundering as well as other types of monetary violations. Countless trade regulators and organisations employ Anti-Money Laundering checks as the first step in the HR and recruitment process as it helps HR people ensure that employees and candidates have the qualification to work or practice. Checks are also frequently utilised to detect clients while also confirming that additional organisations in the supply chain are proper and appropriate for the business needs. There is no exact collection of obligations for all Anti-Money Laundering checks nevertheless, the existing applicable regulations that are in place to pursue the advancement of risk-based intelligent surrounding money laundering and other such activities. However, it is important to note that there are laws in place that correlate with the need for an anti-money laundering check. Some of the legislations in the UK for instance include:

• The Terrorism Act 2000 (as amended by the Anti-Terrorism Crime and Security Act 2001 and the Terrorism Act 2006
• Anti-terrorism, Crime and Security Act 2001
• The Proceeds of Crime Act 2002 (POCA) as amended by the Serious Organised Crime and Police Act 2005 (SOCPA)
• Counter-terrorism Act 2008, Schedule 7
• Terrorist Asset-Freezing Act 2010
• The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
• The Criminal Finances Act 2017

An efficient Anti-Money Laundering structure is an indication of your organisations position in opposition to its competitors in the industry against the fiscal offenses. As international commercial nations become progressively more mindful of their obligations, international organisation must develop the comprehensive capability to report these matters and execute procedures, practices, and related risk assessment mechanisms in a bid to minimise their risk and consequence in the grand scheme of things.

CRI™ Anti-money laundering (AML) consultative solution intends to help the investigation of existing systems and further improve operational solutions that decrease your organisations risk of falling quarry to operative, supplier, or outside corporate and fiscal crimes. Our immense Anti-Corruption and Compliance network offers the defense you require when making significant bottom-line decisions crucial to your organisation’s success.

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What are the Outcomes of a Deficient AML Framework?

To have inadequate regulations can result in being indicted with participating in illicit pursuits surrounding money laundering and lead to several of the subsequent adverse outcomes:

• Damaged corporate reputations: brands and organisations who have a diminishing reputation can progressively expect both their supplier and consumer base to weaken causing brand devaluation. This can lead to monetary complexities as well as challenges being able to work in partnership with other organisations and suppliers as a great reputation ensures collaborators that your organisation conducts business lawfully and suitably making them more probable to want to work beside your organisation.
• Negative investor perceptions: in correlation to a wounded reputation, organisations may also find it increasingly challenging to find investors to back their ventures. This could lead to the premature shutting down of a business as well as other issues such as liquidation and bankruptcy.
• Corroding employee morale: trustworthy enterprise always begins from within the corporate culture. Engaging in illicit activities often result in high employee turnaround whilst also corroding employee morale and giving them the opportunity to embark on other illicit activities within the corporate area. This may lead to fraud, bribery and corruption commenced by the employees which is a detrimental and ominous oversight for any organisation. It’s also just as important to screen your employees so you know that your employees are competent for the role in question. Find out more about our employee background screening solutions here.
• Probable consumer boycotts: ethics are just important to a brands consumer as it is to the brand. In the wake of social activism, no organisation is renowned enough to not fall victim to a boycott effort. You may have some loyal consumers left but your organisation may end up with a longstanding, damaged reputation.
• Possible legal action: A general trend when it comes to issues surrounding money laundering is that it usually leads to further penalties surrounding fines and expenses. In this case, legal action not only damages the reputation of an organisation to investors, suppliers, and consumers, it can also result in fines & potential jail terms for company directors and fighting these cases are often as costly as they are time consuming.
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It is evident to see that the aftermath of partaking in illicit money laundering schemes and not implementing anti-money laundering checks can lead to the downfall of the entire organisation. And in a world of ever-tightening regulations, why wouldn’t you want to be one step ahead of the industry?

If the perception of an AML check still feels a little overwhelming to you, why not consider booking a free 30-minute consultation with one of our experts here at CRI® Group? Our specialists have years of experience and are qualified to offer your organisation personalised guidance to fit your professional requirements. Don’t hesitate, get in touch today and stay ahead of the rules and regulations that impact your organisation.

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