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Partners in Crime: Fraud and Money Laundering
Mar. 10, 2020
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copied!
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Great read. As an analyst focusing on FRAML I work with external partners and find it challenging to navigate both spaces. Certain external and even internal parties who focus on Fraud don’t understand the regulatory obligations and value add of our team. Furthermore, fraud departments often only care about how our findings impact the bottom line. I feel that people within the AML space understand that fraud is heavily intertwined with what we do, but find it difficult to convey this to people in fraud. I think the problem should be addressed by the organization, these teams are often silo’d because they fundamentally have different objectives. Fraud is trying to combat disputes and chargebacks and even terms of service violations (as these all affect revenue), while AML is focused on regulatory risk, and more broadly reputational risk. I think change starts both in how the AML community stresses the importance of fighting fraud and with institutional changes to how companies chose to structure their teams.
Excellent contribution, the interaction of the fraud and AML teams is very important, since fraud is a crime and the money obtained by the fraudster was unlawful, which makes it subject to money laundering.
Another important issue is that these reports are considered and analyzed by the FIUs, despite the fact that in many cases the amounts are not greater, their recurrence and the modalities can be used by criminal organizations that in sum can represent high sums of money.