In the Economist this week (issue dated 10 November, with the hugging Obamas on the cover), there are not one but two articles about the mafia in Italy. One (“A plague on all their houses”) concerns the spread of mafia-driven corruption to northern Italy, and specifically to Lombardy, once considered the moral centre of the country. But since 2010, according to the article, “Lombardy’s politics has seen a moral collapse. The last straw was the arrest of the head of housing, Domenico Zambetti, accused of aiding the Calabrian mafia, or ’Ndrangheta”. Mr Zambetti is the fifteenth Lombardy lawmaker to be arrested or investigated; the other fourteen are accused of offences including “taking bribes, illegal party donations, fraud, embezzlement, fraudulent bankruptcy and incitement to violence”.
But in case we in the regulated sector start to feel a bit smug about it all being the fault of corrupt politicians, the second article (“Hands over the city”) soon puts us straight. The ‘Ndrangheta, is moving up from its southern base into Milan. Or, more correctly, as explained by anti-mafia prosecutor Claudio Gittardi, “The mafia has always been here. What we’re now seeing is evolution, with organised crime increasingly acquiring legitimate businesses.” And such mafia dominance is rarely good news: “Mafia firms are unconstrained by ethical concerns about tax evasion, labour laws or safety standards; and their money and readiness to bribe can create a competitive advantage. Construction, for example, is big business for the ’Ndrangheta.” But surely, if the mafia are concentrating on taking over and corrupting legitimate businesses, there is a role for the regulated sector to play, in spotting unusual and potentially suspicious activity? Perhaps unsurprisingly, the mafia’s victims rarely step forward with complaints, but what about the professionals who serve them? The article ends thus: “A wall of silence is part of the way in which lawyers, accountants and bankers help the mafia. ‘Aren’t they suspicious? Do they really not know that certain operations are suspect?’ asks Mr Gittardi, pointedly.”
I met with the Head of AML for a major International Bank recently and as we discussed the number of countries he covered in Europe, I suggested that the AML Officer for Italy would be a ‘thankless task’. He just looked at me plainly and said – ‘we have investments and operations in almost all of the CIS countries; Bulgaria, Romania, Croatia, Serbia and the rest of the Balkans, Turkey, Cyprus, Malta etc. Italy is relatively good compared to some of these places’.
Another EMEA Head of Financial Crime said that of the 55 countries he is responsible for, 80% of the SARS reports he receives come from the UK! So 54 other countries only generate 20% of his reports? Very unnerving n’est-ce pas?
Many thanks for these comments – it is always fascinating to hear how AML works in the real world. And although it is gratifying to see that the AML message is getting through to a certain extent in the UK, as you say, very unnerving to see that 54 other countries generate so few SARs!
Best wishes from Susan
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