What is Anti Money Laundering Compliance ?

Historically, money laundering is in existence since almost 2000 years. But it gained prominence in 1920’s when a powerful accountant of the Italian Mafia in United States hired the laundromats to disguise the nature of the financial transactions.

What is Anti Money Laundering ?

All laws, regulations, policies, procedures and pieces of requirements that force banks and financial institutions to proactively Know their Customers (KYC) in order to prevent money laundering is typically termed as the Anti Money Laundering (AML) compliance.

Anti-money laundering collectively refers to a set of laws, regulations, and procedures intended to prevent the money laundering activities. 

Bank Secrecy Act (BSA), which was established in 1970 is probably the first legislation in the world which lays down requirements to identify the source, volume, and movement of currency transported into or out of the United States or deposited in financial system.

The difference between AML and KYC

In banking, KYC is the process that institutions must take in order to verify their customer’s identities before providing services. AML operates on a much broader level and are the measures that institutions take to prevent and combat money laundering, terrorism financing, and other financial crimes. Banks use AML/KYC compliance to maintain secure financial institutions. Anti Money Laundering compliance became widely accepted after the Financial Action Task Force was incorporated in 1989 in Paris as the inter governmental organisation.

Anti Money Laundering Certification

Certified Anti Money Laundering Expert (CAME) is one of the few certification programs in India that compliments the anti money laundering programs of the banks. The AML program require financial institutions to create awareness among the staff members. CAME is one of the most preferred certifications in the Indian banks as it deals with various aspects of money laundering and terrorist financing.

Indian regulations require the banks to report the suspicious activities to the financial intelligence units of India (FIU-IND). In addition to the suspicious transactions, banks and indian financial institutions are also required to file the cash transaction reports.

Certified Anti Money Laundering Expert program is one of the most important certification program. It deals with the Indian anti money laundering laws but spreads its wings to cover the global aspects. CAME syllabus includes the topics on Financial Crimes Enforcement Network (FINCEN), FATF, FATCA and FCPA related provisions. This makes the course global but with the local relevance.

Certified Anti Money Laundering program became popular when the banking sector started relying on the technology to identify the flow of the dirty money. false positives captured by the AML software started growing exponentially. Banks and IT companies were in the need of the trained resources to investigate the criminal activities such as drug trafficking or terrorist financing conducted through the banking system.

Limitations of the legacy systems are giving birth to new banking technologies. Banks are using machine learning, robotics process automation and artificial intelligence to fight money laundering. There are small video courses on Udemy which offer the information about this subject.

Additionally, there are certain video learning programs available on Udemy. This is the global video learning platform. These programs however, give a brief overview of the risk based aml methods.