Financial crimes and the financing of terrorism have become an important global problem. With the development of Technology, criminals commit crimes with new methods. Terrorist groups are already using computer technology to facilitate traditional forms of activity with the development of Technology. They can simply carry out terrorist acts using modern tools. Therefore, It's getting harder to fight these financial crimes. Financial crimes are significant risks for companies. Companies take various measures to protect themselves from financial crimes. It is not easy to take measures against financial crimes. But companies can reduce risks by using Technology.
What Is Terrorist Financing?
Terrorism financing (terrorism funding) is one of the major financial crimes. Terrorists need money for terrorist activity. Terrorists use the money for training, accommodation, buy weapons. Terrorists create funding through donations, drug trafficking, and smuggling. Financial institutions must prevent this funding. If they do not prevent terrorist funding, they become an accomplice in this crime. The way to prevent terrorist financing is by financial institutions getting to know their customers.
There are many local and global Counter-Terrorist Financing regulations. Companies must comply with these regulations. The regulators control the companies. If a crime is detected, various penalties and sanctions are imposed on companies.
Prevention of Terrorism Financing with Technology
Financial institutions in most countries are legally required to monitor and report suspicious activities occurring in their institutions actively. For example, across the world, states have enacted legislation for money laundering and related crimes. Financial Action Task Force (FATF), the international enforcement body, encourages and helps countries create a Financial Intelligence Unit (FIU) responsible for managing the flow of information between institutions and law enforcement agencies. The government legislation and regulation of each country's FIU assumed responsibility for financial institutions to be the first defense against money laundering and terrorist financing.
For a more specific example, the European Commission conducts a risk assessment to identify and respond to risks affecting the EU's internal market. It encourages the adoption of global solutions to react internationally to these threats. As seen in these examples, in many countries, the financial institution takes measures to prevent terrorist activities. Since terrorist groups can efficiently operate with technology, these countries need to combat terrorism with technological infrastructure.
Fight Terrorist Financing with Technology
The conventional techniques and processes that finance companies use to combat terrorist organizations are typically called Anti-Money Laundering (AML). Financial institutions counter-terrorist financing in similar ways, using counter-terrorism financing (CTF) programs for terrorism. Furthermore, Technology helps companies recognize their customers. Companies can now access more data with Know your Customer (KYC) regulations to identify customers who are at risk for them. Companies can check their customers in thousands of lists such as terrorist lists, PEP lists, sanctions lists. This way, they can prevent suspicious transactions and protect themselves from this crime.
Companies use compliance software to check their customers. Compliance software protects companies from potential risks and makes them compliant with regulations. Compliance software saves time for compliance departments. And it is safer than a manual check.
Sanction Scanner is a compliance software. Sanction Scanner provides AI-driven enhanced global Sanction & PEP Screening Services. With API integration, your queries are done automatically. If there is a suspicious transaction, the Sanction Scanner will give you an alarm. Sanction Scanner always keeps its lists up to date. With Sanction Scanner compliance software, you can protect your company from financial crimes.