FATF publishes Virtual assets- Red Flag Indicators of Money Laundering and Terrorist Financing
Based on more than 100 case studies collected by members of the The FATF Global Network, the latest report highlights the most important red flag indicators that could suggest criminal behaviour. Key indicators in this report focus on:
1) Technological features that increase anonymity - such as the use of peer-to-peer exchanges websites, mixing or tumbling services or anonymity-enhanced cryptocurrencies.
2) Geographical risks - criminals can exploit countries with weak, or absent, national measures for virtual assets.
3) Transaction patterns - that are irregular, unusual or uncommon which can suggest criminal activity.
4) Transaction size – if the amount and frequency has no logical business explanation.
5) Sender or recipient profiles - unusual behaviour can suggest criminal activity.
6) Source of funds or wealth - which can relate to criminal activity
For more details and to download the report please visit here.
Risk Base Approach Linkage with Mandatory Leaves –“Better Safe Than Sorry”
ReplyDeleteDue to the rise in banking frauds it is prudent to send employees working at client facing interface like Teller, Operation Manager, Branch manager, Relationship Manager non-client facing departments like treasury business and currency chest and others to a mandatory 10 days leaves in a single spell , absence to which can lead to an operational risk to a Bank.
Another prudent way is effective “staff rotation”
It’s quite natural that while working at a key client facing areas we as a humans develop a relationship with our clients that sometime lead to accommodating unreasonable client request which violates banks internal control processes like---
• Tellers not impounding and reporting the counterfeits currency and returning back to a depositor.
• Not reporting CTR even if cash deposit is above a threshold limits.
• Favoring client by depositing cash in his account to clear the chq in case of insufficient balance to avoid chq return .
• Allowing locker safe deposits operations beyond usual banking hours .
• Tipping off of STR to a client .
• Verifying and submitting incorrect field verification and putting wrong authentications like I confirm I have sighted the original and customer has signed in my presence.
This has resulted banks to be more proactive in exercising mandatory leave policy to mitigate any operational risk , in fact most of the banks have made this as part of there internal audit process .
One step ahead on the same logic few FIs has also mandated a policy of rotating there off payroll staffs like security staff and a pantry boys every 3-6 months.
Very informative and need to do activity.
ReplyDeleteGreat insight
ReplyDelete