Shining a Spotlight on Due Diligence Checks in the Fight Against Money Laundering

The recent news in Singapore over the latest anti-money laundering operation which has so far led to the seizure of more than $1 billion in assets, has resulted in a renewed spotlight being shone on the importance of appropriate due diligence checks being undertaken by companies and financial institutions. 

I recently contributed alongside other legal and compliance experts to a recent article published by Citywire Asia, which highlighted the following:

1. There will be renewed focus on front office operations, technology solutions and source of wealth checks.
2. Staff across all areas from front office to back office play a crucial role in mitigating money laundering.
3. The importance of regular training to ensure the competence and vigilance of the front office, onboarding and compliance teams.
4. The regulator may be checking for lapses in customer due diligence including around beneficial ownership identification, screening of red flags, risk management and source of funds and source of wealth.
5. Verification of source of wealth remains complex particularly when dealing with wealth obtained from overseas, held in complex trusts or involving virtual assets.
6. Documentation provided by clients for identification or to support source of funds or source of wealth should not be taken at face value but should be verified for accuracy and completeness. 
7. RegTech solutions are a necessity and financial institutions need to continue to invest and adopt smarter technologies to stay ahead of the game.

The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.

FTI Consulting, Inc., including its subsidiaries and affiliates, is a consulting firm and is not a certified public accounting firm or a law firm.