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Reading the Tea Leaves, Consultants Predict Shift in Cartel Laundering, Casino Crackdown and More Information Sharing in 2014
printIf 2013 saw fewer headline-grabbing fines for financial compliance violations, it wasn't due to a lack of interest from federal investigators and regulatory officials. With plenty of convincing reasons, representatives of the law enforcement and compliance industry say the coming year is fraught with serious challenges. For one, the Paris-based Financial Action Task Force (FATF) will grade the anti-money laundering (AML) and counterterrorist financing regimes of member-states with a new effectiveness score. A crackdown by the United States and other countries on tax evaders will also likely continue unabated, leaving some banks between prosecutors and the clients who have hidden...
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Sometimes a decline in bank enforcement actions isn't a good thing, even for bankers. Such is the takeaway of a review of enforcement action data spanning back five years, during which the number of formal Bank Secrecy Act penalties fell nearly 20 percent while fines and regulatory demands grew.
Last year, I told you not to believe any of that "best of years, worst of years" stuff à la Charles Dickens with regard to 2012. But if 2013 was less eventful than the prior year, every indication is that 2014 will be "challenging" for financial institutions and regulators.
Relative to the year before, the anti-money laundering (AML) compliance industry drew few headlines over the past 12 months, and yet no one would tell you their job got any easier.
The median salaries of compliance officers tasked with identifying money laundering and other financial crimes rose nearly six percent from 2011 to 2012, according to an industry survey released Thursday.
The annual number of suspicious activity reports filed by money services businesses fell by 14 percent in 2012 compared with the previous year, the U.S. Treasury Department said in a report Wednesday.
Penny stock fraud and soon-to-be introduced customer due diligence regulations should be foremost on the minds of compliance officers at small securities firms, believes Kenneth Cherrier, senior vice president and chief supervisory officer at Overland, KS-based Waddell & Reed, Inc.
Though none can predict the future, one thing in the AML world seems certain: the jobs of compliance officers won't get any easier in 2013.
For many anti-money laundering and sanctions professionals, 2012 will be remembered as a year of record fines. Banks paid billions to settle AML and sanctions compliance violations, with one penalty alone reaching almost $2 billion.
The number of federal anti-money laundering enforcement actions issued in the first half of 2012 fell by 35 percent in comparison to the total levied during the same period last year, data shows.
The total number of anti-money laundering enforcement fines handed down by federal regulators rose by 67 percent in 2011 compared to the previous year.
A planned regulatory overhaul, economic sanctions against Iran and the enforcement of anti-bribery rules will be among the biggest issues British financial institutions contend with in 2012, say experts.
Whether the economy improves or stays flat in 2012, the coming year will pose a number of new challenges for the compliance professionals charged with implementing sanctions and anti-money laundering controls, say industry leaders.
Tax investigations, political turmoil and economic sanctions were among the biggest challenges faced by the compliance departments of financial institutions in 2011, say bank officials and industry experts.
The number of anti-money laundering enforcement actions handed down by federal banking regulators rose nearly 48 percent in the first six months of 2011 compared to the same period last year, data shows.
Possible budget cuts for the U.S. financial intelligence unit are spurring concerns that the bureau may curtail its funding of the Internal Revenue Service's anti-money laundering examinations, say current and former federal officials.
The number of suspicious activity reports annually filed by depository institutions dropped 3.2 percent in 2010, the largest drop ever in the regulatory filings, according to U.S. data.
The new year won't be any easier on compliance officials at banks and money services businesses, and could get much harder depending on how U.S. officials implement new and proposed regulations, according to industry leaders.
Regulatory pressure grew on financial institutions in 2010 though few compliance departments saw an increase in budgets or resources in the wake of an 18-month recession, say industry professionals.
The overall number of regulatory enforcement actions against banks jumped 52 percent in the first half of 2010 in comparison to the number issued in the first half of 2009.
Bank closings and enforcement actions for capital requirement and credit risk violations didn't preclude law enforcement and regulatory officials from pursuing banks for violating U.S. and international sanctions in 2009 or from leaning on financial institutions to catch tax cheats.