“We Didn't Start The Fire*…”

Another “takeaway” I had from the ACAMS 20th Annual AML & Financial Crime Conference came from a closed-door session for large banks. Sadly, the group feels under siege. Group members grapple with regulatory, legal, policy, and other challenges that appear greater than any other time in AML history.

The discussion covered a few topics we all would expect—derisking, exams, terrorist financing challenges, and at least one other that resonated with me. Several AML veterans rhetorically asked why there is not more support for all of the essential information financial institutions provide to law enforcement. Separated from regulatory mandates, there is a widely held view that the AML focus of the government, policy makers, and the public falls solely on mistakes, violations, and crimes and that there is no credit for the large swath of committed private sector partners that are dedicated to attacking the use of illicit funds.

No one expects sympathy. In fact one misguided AML professional in the room chided others in the meeting for “whining,” which is, in my opinion is a very naïve view of this complicated area and wrong.

But perhaps a money laundering history lesson is in order.

Prior to the mid-1980s, it was inconceivable that the financial sector would spend resources on being proactive in addressing societal crimes like money laundering. This should not be taken as opposition to that concept but, as with most analysis, the era before the adoption of money laundering laws was different. I find the lack of historic context in today’s world to be generally troublesome but in our “industry” it is counterintuitive. We cannot advance if we do not learn from past mistakes and successes.

So, for a brief and admittedly superficial recognition of AML, I am going beyond my usual weaving in of song titles for blog titles, and “song-blogging.” If Billy Joel was writing “We Didn’t Start The Fire” today in response to the issues facing the money laundering prevention community, it might go something like this:

•

Bank of Boston, CTRS, Structuring, Drug Wars Control Act, Austrac, B C C I

ABA-ABA, FinCEN, G-7, FATF and more

Annunzio-Wylie, Safe Harbor, Advisory

Suppression Acts, HIFCAs, “Permanent” reviews

Wolfsberg, Egmont, Travel Rule, Exemptions stop

KYC  is attacked, prevalence of OFAC

SARs replace CRF, ML strategies commonplace

Private banking risky, MSBs need register

We didn't start this fire

It was always burning

Since the world's been “earning”

We didn't start this fire

No we didn't light it

But we will fight it

Terrorists Attack, Patriot Act enacted

CIP, 314, correspondent banking

Broker-Dealers file SARS, as do insurers

MRAs, penalties, fines are now a vast array

FFIEC, ACAMS, now a strategy

Risk Assessment, Modeling, is RBA a reality?

Wire stripping, SAR delays, training needed everyday

Beneficial owners, Delaware/Nevada still loners

FBI, HSI, IRS and other “guys”

Bribery, Corruption, FATCA and Gamers

Broad roles, systems, stay out of prison

Ukraine, Libya, Somalia and Syria

Cuba, Iran, Sanctions seem everywhere

Derisking, Inclusion, there remains confusion

High Risk, Low Risk, Marijuana banking

Bitcoin, privacy, cyber a necessity

Financial crime, AML, PEPS review as well

Al Qaeda, ISIS, all of this a crisis

Trafficking in humans—we can’t take this anymore!

We didn't start this fire

It was always burning

Since the world's been “earning”

We didn't start this fire

No we didn't light it

But we will survive it

•

So, as we grapple with the collective struggles of the AML community, it is important that we continue to recognize the role each partner must play and how there is a 30-year history of issues, cases, laws and regulations.

Frankly, my attempt to categorize and chronicle only touches the surface.

The AML community is not seeking sympathy, just a fact-based view of the thousands of professionals in the private and public sectors that find their work to be a career and a passion, not simply a job.

* Billy Joel from his 1989 album “Storm Front.”