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Money Laundering Detection

You've been asked to set up internal controls for money laundering for the company that you work for. You are a bit taken aback because you didn't know that your company would need controls.

- What type of businesses are targeted for money launderers? Why?
- What exactly should you be looking for when setting up your KYC policy?
- What sort of record-keeping procedures should you develop?
- Who and how should the money laundering activity be monitored?
- How would you alert and train the staff to recognize a potential money launderer?
- What if a potential money launderer is identified?
o What should you do?
o What would you tell the staff to do?
o What time frames would you put in place?
o What regulator (s) would be involved?
- If you are ever audited by a regulator, what will you be able to show them?
- The internal controls should be written as procedures for the entire staff. Include forms you would ask the staff to use and other documentation that you know would be necessary to produce when you are audited.

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In accordance to BrainMass rules this is not a completion of assignment but only background help.

You have been asked to set up internal controls for money laundering for the company that you work for. You are a bit taken aback because you didn't know that your company would need controls.

What type of businesses is targeted for money launderers? Why?

The types of businesses that are targeted for money laundering are banking and insurance. The reason is that these two help the money launderers change from illegitimate cash to properly invest-able money. For this reason the money launderers target businesses that require large payments. For example the purchase of a luxury yachts, the purchase of large and expensive properties, or businesses that require large investment. The purpose of the making these payments is to establish that these payments are legitimate. Usually these investments are made during the integration phase of money laundering. The banks and insurance companies are targeted during the placement stage of money laundering. Other favorites are money exchange companies, antique dealers, and jewelry dealers.

What exactly should you be looking for when setting up your KYC policy?

When setting up a KYC policy in case of a bank, I must take into consideration the requirements of the Bank Secrecy Act and the USA Patriot Act. This must be approved by the bank's board of directors. It must include new account opening ...

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