1. Could you explain the concept of money laundering in simple terms?
Simply put, money laundering is the process of making dirty money look clean. Money laundering occurs when funds from illegal activity are moved through the financial system in such a way as to make it appear that they came from legitimate sources.
2. What is the biggest challenge in this sector?
Being as dynamic and diverse as it is, identifying a single challenge as the “biggest” is impossible. What stands out is the ability of criminals to launder money by using new and emerging trends and technologies, versus the limitations on the budgets set for Compliance and AML.
3. How can governments stop money laundering? What do you think, can they?
It is nearly impossible to stop money laundering; however, by applying an effective Public Private Partnership (PPP) we might reduce money laundering to a minimum. Moreover, the governments should periodically evaluate the effectiveness of the regulations set to hinder money laundering and update these regulations whenever needed.
4. Why is money laundering bad for the economy? What is the worst effect?
When big money made through illegal activities is successfully laundered and entered into the financial system, it will create an ever-increasing circle of criminality which draws more and more people into its net.
Legitimate businesses as well as public employees will be persuaded to jump to the criminal side and benefit from the prizes.
Productive businesses, bought for the sole purpose of cleaning money, become unproductive or ‘sterile’. Efficiency in the real sector of the economy is therefore reduced, which stops economic development and reduces the growth of the economy.
5. What are the best books to read to learn about Anti Money Laundering? Have you any recommendation?
Before reading any books, I recommend reviewing the ACAMS website for study materials, the FATF regulations, and the EU AML directives and follow up on the periodic updates in AML/CFT regulations and typologies.
6. What is the essential qualification of an anti-money laundering officer?
An essential qualification is for an anti-money laundering officer is vigilance. He or she should be able to have a helicopter view over the business cycle and should know how to connect the dots and trace the transactions to the ultimate beneficial owner.
7. How has anti-money laundering changed over the time?
The AML profession has become more complex and demanding. Regulations and requirements are changing dynamically, threats are always on a rise, funds are moving faster and tracing them is growing to be more difficult.
On the other hand, Compliance and AML are actively present in the Board of Directors, and their opinions and recommendations are appropriately perceived.
8. How can a transaction be called money laundering?
When a transaction’s size, nature, or frequency is unusual and different from the client’s historical activity and type of business, it is flagged as “suspicious”. Subsequently, if the client fails to provide adequate supporting documents, the transaction can be called as “money laundering”.
9. Have you any recommendations to fintech startups about the AML process?
Fintech companies must understand that their exposure to money laundering might exceed that of regular banking institutions; therefore, a valid and innovative compliance program must be adopted. Moreover, the basics of AML regulations must be actively embraced: Customer Onboarding, KYC, Due Diligence, Enhanced Due Diligence, and most importantly Risk Based Approach.
10. How did you get CAMS certificate, how did you prepare?
The CAMS certificate is the most prestigious certificate in AML/CFT. To prepare for it I recommend having at least a couple of years in AML experience which will certainly help in the case studies. For my preparations, I used the official study guide, allocated enough time and committed to a schedule, and read the material from time to time in order to memorize it better.