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Money laundering: What finance directors need to know

www.accountingweb.co.uk

As money laundering rules become more onerous we look at what the finance director has to consider and how to build an appropriate strategy. By Dr Abe Abrahami.

It has long been a necessity for the criminal, making their ill-gotten gains appear legitimate to their family friends and government. But today with the illegal drugs' business rivalling the size of the pharmaceutical industry and terrorists acting like multi-national executives, money-laundering has become an even more sophisticated business.

New laws and renewed vigour by global intelligence and police agencies to stamp it out, have put more pressure on companies and their directors to be pro-active in fighting it. And like anything that revolves around money, the process of monitoring it and being prepared to defend against it, falls to the beleaguered finance director.

In the simplest terms money-laundering is a criminal attempt to conceal the true origin and ownership of proceeds from theft, fraud, drug trafficking, insider-trading or terrorism. On the other side of the coin it is also the attempt to use legally derived funds for illegal purposes, such as financing arms trade, although this is less common.

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