Whether we are discussing sanctions, terrorism, or the many forms of financial crime, every day is potentially a new event. Also, in this environment, one never knows whom to believe or if we have all the facts on any particular issue. (Yes, facts do still exist.)
As AML professionals, we need to stay abreast of policy debates, enforcement actions, reports, hearings, and just “negative news.” And we need to focus on our jobs… to wit:
• We do not have the luxury of questioning whether Iranian sanctions are working … just that our banks need to comply.
• We cannot opine on whether legalization of marijuana in the states “trumps” enforcement policies of the current Attorney General … but we do need to protect our firms from legal jeopardy.
• We also cannot allow our political views to cloud the need to respond to reports on potential money laundering through real estate of our clients … we must perform proper due diligence—and report what we find.
So, despite all the noise, what is going on in 2018?
On Capitol Hill
First, Congress is actively considering changes to the BSA/AML infrastructure for both valid and erroneous reasons. After the House hearing we reported on last year, the Senate is looking at AML as well.
As has been mentioned before, a number of stakeholders are pursuing changes to reporting but have they thought that through?
Uh, not even close.
In the Senate last week, Dennis Lormel testified. He is an ACAMS Advisory Board Member and formerly headed the FBI’s Terrorism Financing Operations Section.
Lormel made it clear that the Bank Secrecy Act regime is not broken, but needs adjustment.
Unfortunately, his co-panelists decided to resort to exaggeration instead of facts.
I will leave to others to read the testimony and review the Q and A. But here is what I do know:
A statement that Suspicious Activity Report narratives are useless to law enforcement is blatantly false. Making such a claim evidences a total lack of engagement with our law enforcement partners.
Similarly, a snarky comment that banks now have to file SARs on sales practices ignores the elephant in the room.
If you want to adjust, modify and improve the AML regime, do us a favor and do your homework; otherwise you lose credibility.
It is sad that anyone has to point this out. But this is the world we live in today.
Human trafficking needs more focus
To finish on a more promising note, the horrific crimes of human trafficking are fortunately receiving extensive focus from the well-regarded Polaris Project, as its members work tirelessly to perform community outreach and point out that all of us need more information on elements of this crime.
Specifically, at an event I attended last week in Washington, D.C., a panel of private-public sector participants trumpeted the fact that there are 12 bills in this Congress addressing human trafficking, all seemingly bi-partisan.
Experts added that in the ten years of the availability of the hotline [1-888-373-7888 ] created by Polaris, there have been 7,000 cases of so-called labor trafficking, which is only 13%-17% of the total complaints.
Polaris emphasized that labor trafficking is not receiving the focus it deserves and needs to be considered as damaging to victims as sex trafficking. For example, with a projected 3.4 million elder care jobs in the near future, there is real fear that the older population will be harmed by trafficking in those forced to perform labor for the elderly.
There are many more examples in farming, nail salons, and even door-to-door sales.
In a world of false information and myths (such as the claim that forced labor victims are mainly illegal immigrants), can we please listen to words of former N.Y. Senator Daniel Patrick Moynihan:
“You are entitled to your opinion. But you are not entitled to your own facts.”
Come on everyone, we can do better.
*Album and film of the same name by the Talking Heads in 1984. One charting song from the album, “Burning Down The House” could be a premonition about what is happening in Washington today.
- Citi Silences Critics by Raising Minimum Wage
- Top Colleges Are Offering Crypto and Blockchain Classes: Should Your Bank?
- How AI is Fighting Money Laundering
- Why AI is the Only Option for Combating Money Laundering, Terrorist Financing and Other Illicit Financial Threats
- Lessons Learned: What Other Countries Can Teach the U.S. About Open Banking