So I’m not wasting my time

As you may have gathered, I’m rather keen on the old AML malarkey.  I was very , very lucky to stumble into it – having scraped through all my numerical exams by sheer bloody-mindedness, I would never have chosen or been recommended for a career relating to finance in any way – and am grateful every day for having a job that fascinates, absorbs, challenges and only sometimes frustrates me.  But I do have to be realistic, and face the fact that – if we all do our jobs properly, and with a following wind – I should be hoping that our collective AML efforts will eventually make me redundant.  So when new research comes out into the scale and form of money laundering, particularly locally, I read it avidly.  (Well, I open it, put “laundering” into the search box, and page through it looking for those bits – I’ll get back to firearms and cyber crime later, so to speak.)

Yesterday the UK’s National Crime Agency (NCIS/SOCA as was, from the AML perspective) published its annual “National Strategic Assessment of Serious and Organised Crime“.  (By the by, I have noticed that sometimes it is “serious organised crime”, and sometimes it is “serious and organised crime”.  Have they had to change to the latter because of all those organised criminals who like a laugh, or the serious ones who are just plain chaotic?)  This is not a hugely detailed document – it is, as it says, a “strategic assessment” – but it does devote lovely space to money laundering, and to its cousins economic crime and cyber crime.  The distinctions become harder to draw, of course, and the NCA acknowledges this by referring to “cross-cutting crimes”.

But looking specifically at money laundering, there is the admission (which will make a guest appearance in much of my training over the coming year) that “Many hundreds of billions of pounds of international criminal money is almost certainly laundered through UK banks, including their subsidiaries, each year”.  Now for some key questions.

  • What makes the UK so attractive?
    “The high transaction volume (estimated at trillions of pounds a day), language, developed financial services industry, and political stability of the UK.”
  • How are the launderers doing it?
    “Most proceeds of UK serious and organised crime are laundered through UK banks, wire transfer companies and other regulated businesses including Money Service Businesses (MSBs) and cash-rich businesses.  A large proportion is sent abroad where profits are often ultimately invested in real estate.  Importantly, a proportion is re-invested into criminal activity in various stages of any serious and organised
    criminal venture.”
  • Who else is involved?
    “Many criminals rely on professional enablers such as businesses that register
    and run ‘shell’ companies and trusts in numerous ‘off shore’ areas.  Illicit profits are often laundered through cash rich businesses.  Complicit, negligent or unwitting
    professionals in financial, legal and accountancy professionals in the UK facilitate money laundering.  Specialist money launderers, some overseas, manage laundering for multiple criminal enterprises.”

So it looks as though our jobs are safe for a while – is that what’s known as a silver lining?

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6 Responses to So I’m not wasting my time

  1. David Maxwell says:

    Another interesting piece, and another frighteningly large figure! Where has this one come from, and has anyone audited it or traced it back to source? I remember the last guess of £6bn that was commonly used in AML training sessions was shown to be based purely on hearsay and circular references to other articles; it had no basis in reality. One guess apparently used the difference between actual electricity usage in a selected region against the amount billed for, the gap supposedly showing the amount of fiddling that was going on! The truth is we have no idea how much money is being laundered in the UK; we just know it is a big problem, and that we all need to play our parts as good citizens in trying to tackle it.

    • You’re right,of course, David – and measuring any crime absolutely is always nigh on impossible. It’s why we have the Corruption Perceptions Index, rather than a Corruption Index – who do you ask? who do you trust? Even a seemingly reliable measure like the number of convictions presupposes that the legal system works as it should, in a fair and non-corrupted way.

      The important sentence is your last one: money laundering is a bog problem. I suppose the point of giving figures is to surprise/shock people into realising quite how big – personally I have always found comparisons useful too (equivalent to the GDP of Spain, twice as big as the global automotive industry, etc.).

      Best wishes from Susan

  2. Rowan Bosworth-Davies says:

    Be careful Sue, any more articles in this mode and the Government and its regulatory satraps will start to think that you are being critical of them and their conduct and they will begin to think that you might be getting like that ‘untouchable’ RBD! Then your work will dry up and your contacts won’t return your calls. Sad state of affairs, but horribly true! LOve, Rowan.

  3. Fair warning, Rowan! I’d better start squirrelling away some savings for those leaner times…
    Best wishes from Sue

  4. Roy McCarthy says:

    I’m beginning to think that the AML/CFT industry bangs a lot of drums, makes lots of noise, sounds very important but in the end has minimal real effect. You’re right Susan, it’s a job creator and likely to remain so.

  5. Goodness, Roy, I’m not sure that’s the point I meant to make! In strict terms, of course, AML has created plenty of jobs – including my own – but I do believe that it has more than a minimal effect. For instance, if you ask the man in the street what money laundering is, he is quite likely to know -whereas twenty years ago that was not the case. And the more people who know what criminals get up to, and how it damages us all, the harder it is for those criminals to pull the wool over our eyes.
    Best wishes from Susan

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