Anti-Money Laundering Compliance
17 October 2018 00:00
Money laundering is one of the most serious financial offences that can be committed under local and international law.
In South Africa, those found guilty of this white-collar crime face penalties ranging up to R1 billion and life imprisonment, while companies that fail to mitigate operational, financial, legal and reputational risk – by not complying with AML and Know Your customer (KYC) regulations and the reporting of suspicious activity – can also become exposed to fines of up to R100 million or imprisonment of their leadership.
With the risk of fines, imprisonment and an additional risk of reputational damage, compliance with anti-money laundering regulations is not negotiable.
Accountable institutions are expected to apply a risk-based approach to AML compliance by effectively and efficiently understanding their suppliers, partners, acquisition targets, contractors, resellers, grant applicants, customers and other associates.
For AML & KYC compliance, investigations into watchlists, PEP lists, negative news, company reports, personal profiles are necessary. However, there are challenges with achieving this level of detailed results frequently, according to LexisNexis Data Services General Manager, Rudi Kruger.
“AML and KYC regulations are difficult to interpret correctly, which means companies run the risk of inadvertently failing to comply,” said Kruger.
“Additionally, the shortage of adequately trained professionals and internal technological infrastructure makes compliance a tricky and challenging task.” He added that compliance can be very costly, especially when a DIY approach is taken or if it is outsourced to consultants.
“Due diligence and compliance are far less intimidating to companies that realise the value of technology in the process. Today, special tools and online solutions take the stress and anxiety out of the mix,” said Kruger.
To meet the needs of AML & KYC Compliance, LexisNexis Data Services offers an enhanced due diligence solution, Lexis® Diligence for corporate security professionals. LexisDiligence is designed to serve as an online enhanced due diligence researching tool. It provides access to over 40 years of archived comprehensive adverse news, sanctions and extensive warning lists, PEPs, director and shareholder listings, biographical references and directories, and comprehensive legal source material. It has the ability to monitor and assess potential security threats abroad by checking comprehensive country information and on the ground media reports. In addition, Lexis Diligence helps users save time and money by performing enhanced due diligence checks on individuals, clients, partners and suppliers in-house, rather than working with expensive consultants.