By Zac Cohen, General Manager, Trulioo
Banks are spending $20 billion on compliance in an effort to combat money laundering, yet only one per cent of illicit financial flows are seized by authorities every year. While regulations have been introduced to crack-down on money laundering, so far they have had a limited effect. Given that banks will incur more than $400 billion in fines by 2020, as a result of misconduct and inadequate AML measures, organisations are under pressure to strengthen their own customer due diligence in order to avoid heavy fines.
Simultaneously, international trade is also becoming increasingly susceptible to trade based money laundering (TBML). Although the World Trade Organisation anticipates merchandise trade volume growth of 4.4 per cent in 2018, TBML accounts for hundreds of billions of dollars of illegal money flows annually.
Operating on such a large scale, techniques for money laundering have become