AML Conversations

The Financial Crimes Enforcement Network (FinCEN) recently issued guidance about kleptocracies and foreign corruption. The guidance includes insights into typologies and includes red flags. John and Elliot discuss the guidance, the global focus and nature of the problems identified in the guidance, and the value of the red flags as a training tool.

For this episode of our AML Conversations podcast, we sit down with Sara Crowe, the strategic initiatives director at Polaris, a non-profit working to end human trafficking. We discuss how human trafficking has evolved in recent years and concerns following refugees fleeing Ukraine, as well as actionable insights for financial institutions as to how they can help prevent human trafficking. We hope you enjoy this episode.

Treasury Secretary Janet Yellen spoke recently at American University about digital assets. The speech look at the intersection of innovation, policy and regulation. John and Elliot discuss key points in the speech including how innovation in the financial sector often out strips policy and regulation and how the Yellen’s remarks create a good framework for the discussions and activities in the digital asset space.

John Byrne chats with Brian Szady, Founder of a threat mitigation firm Threatminder, on the various cybersecurity issues challenging the AML world, including ransomware, training staff and defining human as well as artificial intelligence.

This week The Washington Post and the International Consortium of Investigative Journalists (ICIJ) published another segment of the Pandora Papers. This latest release focuses on registered agents and their role in representing companies In the United States. John and Elliot discuss the total lack of transparency of corporate ownership in many of states, weakness this creates in the financial crime prevention regime In the US, and ENABLERS Act which was introduced In Congress In October 2021.

In June 2021, FinCEN issued the first National AML/CFT Policy Priorities for the US. John Byrne sat down with Dan Stipano of Davis Polk & Wardwell LLP to record this at the ACAMS Hollywood conference. John and Dan discuss the breadth and importance of the priorities, how to use them in future planning for your financial crime prevention program, and how the priorities may change the overall financial crime response regime.

FinCEN has released new Suspicious Activity Report (SAR) data. The data set covers the full years 2014 through 2021. The information looks at SARs filed by all of the required filers and breaks down the information in a number of ways. John and Elliot discuss some interesting nuggets from the release, speculate on how the data may be analyzed, and talk about finding ways to use the information to improve financial crime prevention programs.

This week the US Department of Justice indicated that it will begin directing prosecutors to “consider requiring” certification at the end of an enforcement action settlement that the “the company’s compliance program is reasonably designed and implemented to detect and prevent violations of the law and is functioning effectively.” Also this week, Chairwoman Maxine Waters of the US House Financial Services Committee issued a letter to trade associations representing numerous US businesses requesting detailed information on the actions that America’s financial institutions and businesses have taken to end their relationships and engagements in Russia and with businesses that support the Russian government. John and Elliot discuss the implications for CEOs and CCOs of the certification idea and how the trade associations may respond to Chairwoman Water’s request from information.

The Financial Action Task Force (FATF) has issued a 2nd Draft Guidance Paper for consideration and agreement to public consultation for the Real Estate Sector. This latest guidance paper will update earlier guidance issued to the sector. John and Elliot discuss some aspects of the draft, including the limited understanding of participants in the sector of money laundering and terrorist financing risks, the large role that the sector plays in many national economies, and the tie in to the Advanced Notice Proposed Rulemaking for new real estate sector reporting requirements, issued by FinCEN in December 2021.

This week FinCEN issued an alert directing US financial institutions to increase their vigilance in watching for efforts to evade Russian related sanctions. The alert identifies several possible evasion typologies that may be used. Elliot  sits down with Tim White, Special Advisor at AML RightSource and global sanctions expert to talk about the alert. Elliot and Tim discuss some of the implications for evasion through the use of virtual currency, and the importance of monitoring changes in transaction flows and volumes, and transactions from new sources. They also note that the alert has value for the financial crime prevention community beyond the US.