Make certain that your business isn’t involved in money-laundering

by | Mar 10, 2016 | Education

Money laundering is big business world-wide, with some authorities estimating that the amount is in the trillions of dollars. By virtue of the fact that this money has either not been declared or has been obtained illegally, it is illicit, and any business that allows this dirty money to become ‘clean’ is considered to be in collusion with the criminals. This would apply even if the company was involved in money-laundering unknowingly. For some businesses, training staff in anti-money laundering is considered just another part of compliance and not that important when, in fact, it is vital.

The potential risks of inadequate anti-money laundering training
For a start, if a business is found guilty of money laundering, there is a risk of huge penalties and great financial loss. Apart from the financial burden, there is also the question of reputational damage. Many businesses spend years building up an image in their client’s minds, and suddenly being investigated and being found guilty of money-laundering could have a devastating impact. Reputable clients will not want to be associated with a business that is considered unethical and carrying out illegal practices, and the damage to the company’s reputation could take many years to repair. It would be a nightmare for any business if the money-laundering was linked to terrorism, as then the reputational damage would be virtually unsalvageable.

Companies that conduct international business are particularly at risk. Fortunately, there are anti-money laundering policies in place, so it’s not that any business can claim that they didn’t know or understand the laws. If anyone is unclear, it would be very advisable and probably most cost-effective to conduct through anti-money laundering training so that all staff know what to look out for and how to react.

The benefits from anti money-laundering training
If proper due diligence is conducted, there will be reduced fraud losses and bad debts. In any case, improving operational efficiency as a result of the training would be a positive factor for any business, and the chances of being exposed to corruption would be greatly reduced. For any company to be caught up in criminal activities is very scary, so good training would go a long way to keeping the business risk free. Experts might also be able to advise on efficient software packages that would provide risk assessment. Obviously, training would need to be on-going as new methods to launder money are constantly occurring, and any fresh intake of staff should receive thorough training as a matter of course.

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