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GRC Professional : GRC Spring 2012
18 GRC Professional • Spring 2012 COVER STORY beyond just catching criminals. AUSTRAC provides detailed guidance on the relevant skills required for a person to be a compliance officer. Apart from being legally aware, officers need to do risk awareness training for staff members, liaise with senior management and the board on AML/CTF issues, and organise independent reviews, contribute to the design, implementation and maintenance of internal AML/CTF compliance manuals, policies, procedures and systems, reporting lines, and use a raft of other protocol to keep money lau nderers at bay. The face of money laundering Money laundering involves dealing with the proceeds of crime in a way that masks ownership of the assets and makes them appear to have come from legitimate sources. "The deeper 'dirty money' gets into the international banking system, the more difficult it is to identify its origin," the United Nations Office on Drugs and Crime says. The methods are diverse but, basically, assets are intermingled with legitimate transactions in areas such as banking and finance, casinos and gaming, international trade and foreign exchange. Sometimes tax havens or "secrecy jurisdictions" -- nations or states that won't divulge information about an individual's financial affairs or structures -- are used to camouflage the money trail. Secrecy jurisdictions currently listed by the Australian Taxation Office as being of concern are Cyprus, Hong Kong, Luxembourg, Panama and the Seychelles. An OECD-led crackdown on tax havens has resulted in a set of global standards. The Global Forum on Transparency and Exchange of Information for Tax Purposes reviews and rates 106 Suspicious minds The obligation to report cash transactions of $10,000 or more and international funds transfer instructions is black and white. But what's a "suspicious matter"? AUSTRAC's executive general manager, intelligence, Liz Atkins, says the following are the most common "red flags" for business: • A customer is particularly interested in whether a transaction might be reported to AUSTRAC. • A customer often deposits, withdraws or transfers money just under the $10,000 limit, a practice known as structuring orsmurfing . • There's a lot of activity on an account by a third party. • Many different people are depositing amounts of money into one account. • The way a person is transacting changes e.g. suddenly there's a lot of money going overseas. • Money is being transferred to countries of interest e.g. Vanuatu, where tax scheme promoters have been active. Collection of dirty money A TYPICAL MONEY LAUNDERING SCHEME Dirty money integrates into the Financial system The methods are diverse but, basically, assets are intermingled with legitimate transactions in areas such as banking and finance, casinos and gaming, international trade and foreign exchange.
GRC Winter 2012
GRC Summer 2013