Crooks looting up to £100 billion due to AML rules failure

Shortcomings in anti-money laundering rules and loopholes in sanctions are allowing crooks to steal up to £100 billion from the UK every year.

Martin Cheek, SmartSearch AML

Shortcomings in anti-money laundering (AML) rules and loopholes in sanctions are allowing crooks to steal up to £100 billion from the UK every year, the latest White Paper from SmartSearch reveals.

Almost half of regulated firms have seen a rise in criminals attempting to launder money or commit financial crime.

And despite the increased threats, a quarter of regulated firms admit to still using flawed manual checks on easily forged hard-copy documents like passports and utility bills.

There is still a widespread and worrying reliance on the use of paper and manual methods of customer verification.”

Martin Cheek (main picture), SmartSearch Managing Director, says: “The use of electronic verification is recommended in the 2020 Money Laundering and Terrorist Finance Act.

“However there is still a widespread and worrying reliance on the use of paper and manual methods of customer verification.”

UKRAINE

The SmartSearch White Paper also reveals more than three quarters (77%) of property firms have not changed their approach to onboarding new customers since the invasion of Ukraine and thousands of new sanctions were imposed on Russia.

And nearly half of all regulated firms fail to check for the “ghost” firms used by criminals as part of a corporate infrastructure designed to hide the connection of criminal beneficiaries.

OUTDATED

Cheek adds: “These outdated practices are leaving regulated firms open to AML and sanctions breaches, which come with eye-watering, record fines and significant reputational damage.

“As criminals and money-launderers become increasingly sophisticated, regulated firms need the cutting edge technology of EV to meet them head-on and take control of their compliance.”

The SmartSearch White Paper is part of the company’s continuing Electronic Verification Uncovered campaign, which aims to raise awareness of the dangers of relying on out-dated, manual methods of identity verification for regulated businesses.

Its findings are based on a comprehensive survey of 500 decision-makers in regulated firms from the finance, legal, banking and property sectors.

Download the White Paper HERE.


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