Anti-Money Laundering Wrap-Up: BSA Compliance Makes Big News

Spitzer Case, Bank Fine Bring New Focus - and New Venues -- to Old Crime
Anti-Money Laundering Wrap-Up: BSA Compliance Makes Big News
Given the news in recent weeks - the controversy surrounding New York's ex-Gov. Eliot Spitzer, the $15 million fine assessed against United Bank for Africa, PLC - we knew the crime of money laundering had taken on a life of its own.

But who knew that it also had crept into Second Life?

Real crimes in the virtual world are absolutely a growing reality, according to AML investigator Kevin Sullivan, who has spent months exploring the world of online money laundering. The initial results of Sullivan's virtual money laundering investigation are available here:

Virtual Money Laundering and Fraud
Second Life and Other Online Sites Targeted by Criminals

Sullivan, a New York police investigator, is a veteran and outspoken voice in the fight against money laundering, and his insights helped shape our coverage of the topic through out the month of April. From risk assessments to Suspicious Activity Reports (SARs) to trends to investigations, we thoroughly explored AML and Bank Secrecy Act (BSA) compliance, offering new insights into an age-old crime.

Structuring. Micro-structuring. Hawalas. ATM fraud. Trade price manipulation. These are all current money laundering trends, and they create infinite amounts of work for financial institutions' AML investigation teams, which are already challenged just to keep up with BSA updates and SAR filings.

But if this year has taught us anything, it's that the SARs are read and do pay off (witness: the Spitzer investigation). And banks will be punished if they don't remain vigilant about suspicious activities (United Bank for Africa). And the good news is: These recent headlines have brought overdue attention to AML investigators who've been quietly going about their business behind the scenes at financial institutions.

As one investigator told me in the wake of the Spitzer news frenzy, "One of my colleagues came up to me and said, 'So, this is what you do - now I get it.'"

By the end of 2008, if current trends maintain, then it's fair to say many money laundering fraudsters will "get it," too.

AML Wrap-up
In addition to the piece Sullivan authored, check out his podcast interview:

Anti-Money Laundering Trends: 2008

And don't miss the excellent webinar he conducted on how to investigate money laundering crimes:

BSA Compliance: How to Conduct an Anti-Money Laundering Investigation

Beyond Sullivan's insights, we also benefited from the expertise of other AML practitioners who enlightened us on new ways fraudsters are practicing their crime. Shell corporations are big, for instance, and we learned about them from Debra Geister of LexisNexis:

Money Laundering Insights: Real Estate Investments, Shell Corporations Among Top Schemes

Real estate investments are another favorite ploy of money laundering criminals, and the economic downturn has also led to a growing number of mortgage fraud cases that run afoul of the Bank Secrecy Act (BSA). You can read more about this trend here:

Mortgage Fraud: a Growing Threat
High-Profile Incidents Underscore Need for Secure Processes and 'Know Your Customer'

For additional insights on AML, please check out:

Anti-Money Laundering Update: Interview with FinCEN Director James Freis
Insights on BSA Compliance, Trends and the Global Fight Against AML

Confessions of a Former Money Launderer
Ex-Con is Now a Crime Consultant, Helping Investigators Follow the Money Trail

And don't miss our other AML webinar - this one on how to conduct an AML risk assessment, as instructed by Commerce Bank executive Anthony Aiello:

Anti-Money Laundering: BSA Risk Assessment

About the Author

Tom Field

Tom Field

Senior Vice President, Editorial, ISMG

Field is responsible for all of ISMG's 28 global media properties and its team of journalists. He also helped to develop and lead ISMG's award-winning summit series that has brought together security practitioners and industry influencers from around the world, as well as ISMG's series of exclusive executive roundtables.

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