July 11, 2020 Blogja.net

6 Preventive Measures Businesses Can Do to Prevent Money Laundering

Money laundering is illegal and a heinous crime that has become rampant. Thus, it gives long term problems for you and your business. Because of this, you can have a long sentence in jail, which can have a negative impact on your personal life.

Small businesses are mostly included in this kind of “organized crime,” as they want easy money and don’t consider where it circulated from, as long as they are having a benefit from it.

How does money laundering work? 

The money will first go through placement. It is where the money will move from source to source until it becomes misrepresented.

The money will then be transferred to banks, casinos, and money changers/couriers locally or overseas. It can also be circulated by purchasing assets, currency exchange, and the blending of funds. 

The next stage is layering, wherein it makes the money hard to trace to cover the laundering activity from the law enforcers.

The last stage is the integration upon receiving the laundered money. The owner can buy tangible assets or transfer the money to a foreign bank to incorporate the complexity of its traceability. 

It is best that you are educated on how to prevent money laundering schemes to avoid perils and to protect your business. 

1. Learn about money laundering schemes

There are countless ways for criminals to perform money laundering. Hence, it is good that you and your co-workers have an informative platform where they can be educated about it in order to properly implement safety measures.

The more tactics you are aware of, the more you will be able to detect the trends and the whereabouts of money laundering. 

It is best that you and your team utilize a trustworthy source that can provide you ample information about money laundering.

2. Know who your customers are

It is very important that you know who your clients are. You should know what the motive for their transaction is.

In the event that something weird might occur while completing a certain transaction, ask them and be able to assist with the query. Be wary that electronic identification verification is a must to identify if the customer is legit or involved in financial crime.

For various businesses that include large purchases, it is important to know who your investors are and what is the source of their income. It is good to have a background of their business’ nature, the too good to be true attitude, overly exciting offers, and make sure not to miss any strange settings as this might be a trap. 

3. Always conduct due diligence

It is important that you investigate a business, its customers, and their reason for purchasing.

According to First AML, an AML Audit NZ company, “Businesses should avoid indulging cash bait or easy money with a stranger, as he/she might be most likely involved in the money laundering scheme”.

A business should conduct a thorough background to see if your current or potential business partners have been previously investigated or charged with a crime. This is to ensure your own and your business’ safety.

Be sure that their company is registered. It can be checked online or through government institutions.

It is also important that you have an accountant and a lawyer when conducting due diligence. They are the people who can help you monitor your funds, documents, compliance, and prevent lapses and possible lawsuits. 

4. Beware of cybersecurity risks

Consumers are falling into online transactions as they can easily be accessed. By transacting online, most people use cards (credit, debit and prepaid cards) that are prone to cybercrime-related cases. Therefore, cyber activities must be strictly monitored to avoid scams, and report anything suspicious. 

Protection must be provided for the business and its consumers. Safety measures such as information confidentiality must be observed to avoid identity theft. A simple regular changing of password can provide you great security. It is also important for businesses to invest in an anti-money laundering system that can tailor fit to the business needs. 

5. Establish an anti-money laundering policy

An anti-money laundering policy is required to monitor financial transactions and the flow of money, accounts, and activities. The policy must contain instructions on which ones to avoid, and how to take action.

Whichever the type of business it is, you must thoroughly indicate the procedures of the policy and determine if you wanted a certain handling procedure to be followed.

A strong basis can help you decide which ones to deal with or have a partnership with. It can assist your team to mold their knowledge, understand each transaction, and identify if they are dealing legally, or might be involved in a money-laundering scheme.

Any suspicious activity must be reported to the authorities to avoid the impact it might give the business.

6. Provide AML training for employees

Given that money laundering is rampant, it is becoming a global issue. The people involved in such are becoming more notorious, technologically updated, and more shady about it. 

To keep the business safe from money laundering, such an establishment must provide training to each employee including the business owner to have strong knowledge about AML. This can also help them cite a real-life example such as how to detect dirty money, and how to deal or resolve it so that people can have exposure to it.

The importance must be instilled to all, and be compliant with the rules and regulations to keep the business’ reputation intact. Therefore, it might save your business from risk and potential loss. 

To Sum it Up

Knowledge about preventions of the money laundering act is indeed a vital practice each business must observe.

Since we know that it’s very hard to chase the criminals and the mastermind of the crime, safety precautions must be instilled, proper monitoring should be made, and report anything suspicious to keep the business’ reputation intact and have financial stability.

A strong anti-money laundering scheme should be made to avoid luring criminals.

Related Posts

How Busy People Can Train Their Dogs

February 6, 2019

February 6, 2019

For many of us, dogs are part of our lifestyle and they are simply part of our family members. However,...

Understanding Market Development

May 28, 2019

May 28, 2019

For many companies, market development is a viable and successful growth strategy. It’s a way in which you can see...

Small Business Phone Systems for Startups

April 6, 2020

April 6, 2020

Building a startup out of the earth up or keeping your company afloat in a very competitive economy is a...

English Grammar Rules in Score Assignment Writing

October 10, 2017

October 10, 2017

English Grammar Rules in Score Assignment Writing: You Need to Get a Higher IELTS Score The e-learning advances and growing...

Top Features that Help Your Dating App Succeed

April 9, 2019

April 9, 2019

When you make your mind to build a dating app, you better be prepared to confront existing market leaders, like,...

Larger Than Life: The Most Important Exhibition You Missed This Year

September 2, 2019

September 2, 2019

Zurab Tsereteli is the most successful artist you’ve never heard of, and this year Britain had the chance to explore...

How To Improve Customer Experience?

November 30, 2019

November 30, 2019

Improving client experience isn’t a one-day work, nevertheless, it is something you can deal with piece-by-piece with time up until...

How to Teach Your Young Children an Active Lifestyle?

February 14, 2019

February 14, 2019

Obesity is a widespread health problem, due to abundance of food at relatively low cost. It’s important to motivate yourself,...

Six Things to Consider Before Completely Going Vegan

February 25, 2019

February 25, 2019

Many people discover that going vegan turns out to be quite frustrating. Thankfully, there are things that we could do...

Best 5 Free American Classified Websites

May 29, 2020

May 29, 2020

Do you want to post free ads and reach out to your desired customers online? There are multiple platforms available...

Understanding How Youth Offending Teams Work

June 24, 2019

June 24, 2019

When you are discussing youth offending jobs, a lot of the time, you are mostly thinking about a role such...

The Best Footballers from Ghana

August 14, 2019

August 14, 2019

The Ghanaian football team is one of the most celebrated African sides in recent history. Football being the most popular...

How to Find Brilliant Content Ideas for Your Target Audience

February 4, 2020

February 4, 2020

Nowadays, the trend is all about researching and penning down opinions and experiences to global readers.  It often gets difficult...

A Simple Guide for Facebook Ad Re-targeting in 2020

April 6, 2020

April 6, 2020

What is Facebook Remarketing or Retargeting? Facebook nourishes your ad appears to remind them what they are overlooking. Describes remarketing...

Eight Best Travel Comfort Accessories For Long Trips

September 25, 2019

September 25, 2019

Travelling is such a fun thing. You get the chance to meet new people, explore different cultures, try various delicious...

Comments
Leave a Reply

Your email address will not be published. Required fields are marked *