Blame where blame is due

If I may mix my four-legged metaphors for a moment, regular readers will know that one of my hobby horses is the use of AML legislation as a scapegoat.  It makes my blood boil when people tell me that their bank or law firm or accountant has refused to do certain things for them “because of money laundering”.  Of course I don’t get annoyed when it turns out that what they hoped to do was, well, money laundering, but here’s an example of what I mean.

I was chatting to someone the other night in a social situation – astonishing, really, that I still get invited out, given my intolerance and obsessions, but there you go – and when I said what I do for a living her little eyes lit up.  Now, this is not the usual reaction when I give my spiel (which I have honed to this: “I am an anti-money laundering consultant, which means that I advise institutions like banks, accountants and casinos on how to avoid criminal money”), and so I knew she had an AML concern.  And indeed she did.  Her friend’s son, she said, had just come out of prison after serving “a well-deserved sentence for assault” (that’s her speaking now – not my spiel again).  And when he went to the bank where his parents had been blameless customers for years and asked to open an account so that he could look for work – the Jobcentre advises people to have an account lined up, as it’s all but essential nowadays for working people – he was told that he couldn’t have one “because of money laundering”.

Now, had he been sent down for fraud or burglary or drug dealing or any other acquisitive crime, I can see why they might have been nervous.  After all, he is a convicted criminal and presumably there were criminal proceeds; I would certainly be asking about confiscation proceedings.  But assault generates no proceeds.  When pressed further, the bank said that the AML legislation means that they cannot open accounts for people with criminal records.  When my enquirer said this, I danced a little jig of anger on the spot – what with this and my boiling blood, I was quite a sight.  How many times?  The AML legislation requires institutions to put in place procedures that are appropriate and proportionate to the money laundering risk presented.  It does not say that you CANNOT open accounts for anyone; it says that you may, after risk analysis, choose not to.  In this case, personally, I think the bank may have made the wrong choice.  And more than that, I hate hate hate the fact that the poor little Money Laundering Regulations once again get the blame.

(Moreover, with my social and magisterial hat on – it’s quite a grand affair, as you can imagine, with feathers and everything – I worry enormously about the problem that this creates with recidivism.  If a prisoner is released, having served his sentence, and is trying to go straight by getting a job, and the thing that foils him is that he cannot get a bank account, what then?  Of course, he returns to crime – how else is he to make a living?  Now you see what you’ve done: I’m jigging, with boiling blood, and wearing a silly hat.  No wonder I don’t get invited out much.)

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6 Responses to Blame where blame is due

  1. Claire says:

    They should have just said: “Sorry, we don’t want you as a client.” in stead of making up a story. I agree with you that prisoners who have served a sentence, should be given a fair chance on the job market. Better to keep them busy making money, then making them feel they have no choice but to return to crime. I can understand you are not happy that AML is getting the blame. And I’d be happy to meet you with your silly hat any time 😉 Keep up the good work!

  2. I knew you would understand, Claire – and I’m glad that my headgear would not put you off!
    Best wishes from Susan

  3. Paul Coleman says:

    Hello Susan, I share your frustration here. Personally, but I could be wrong, I doubt whether a bank would go into print in its documented procedures manual to say that they will not open an account for someone with a criminal record. I am inclined to believe that this is a “hand me down” anecdotal message from a fellow employee. The end result is that the staff are making their own interpretation – so either a training issue or the manual is not sufficiently clear. Its always easier to ask a colleague rather than review the manual. The bigger problem to senior management is of course they have no idea that potential customers/clients are being turned away because of such interpretation and of course how many.

    As a regulator I get a similar interpretation – I discuss with licensees, that PEPs must be high risk clients, only to hear from other licencees a few weeks/months on that “our regulator does not want us to have PEPs as clients.” So frustrating.



  4. Thank you, Paul – I think you express it very well. You’re right about people asking colleagues rather than checking “the source”, and getting Chinese whispers. I’m always telling people (well, MLROs) to go back to the beginning: check what it actually says in the legislation and the guidance. And for staff, the message should be to check the written procedures, and not rely on what the person on the next desk seems to remember.
    Best wishes from Susan

  5. Roy McCarthy says:

    Quite. On a similar tack my pet hate is when you’re told you can’t have the information ‘because of Data Protection’ because they heard someone else say it.

  6. Yes, it’s the quick, easy answer rather than the right one – and it makes ill-informed people blame the legislation which, with some exceptions, is generally carefully thought through. I suspect the same thing happens all the time with the health and safety legislation…
    Best wishes from Susan

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