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Compliance and reporting issues arising for financial institutions from money laundering regulations: a preliminary cost benefit study

Compliance and reporting issues arising for financial institutions from money laundering... Explores views on the costs and benefits of financial institution compliance with money laundering regulations as a precursor to a full cost benefit study. Notes that there is very little information on the costs and benefits of money laundering, which is linked with the difficulties of estimating the volume of money laundering that is occurring. Deals with attempts to measure money laundering; the problems involved in this have resulted in a system and procedure based approach which focuses on input rather than output and is clearly inferior. Looks at the costs and benefits for private compliance with money laundering regulation. Moves on to the UK’s money laundering control system, which is based on the Financial Services Authority; financial institutions have to file suspicious activity reports (SAR( and to know their customer, but it is not clear that statistics on these activities show more than the companies’ compliance. Concludes that the industry regards these duties, ie of policing the regulations on behalf of the government, as a burden, and that if this is regarded as excessive, there will be a deterrent to cooperation. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Money Laundering Control Emerald Publishing

Compliance and reporting issues arising for financial institutions from money laundering regulations: a preliminary cost benefit study

Journal of Money Laundering Control , Volume 7 (4): 14 – Oct 1, 2004

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Publisher
Emerald Publishing
Copyright
Copyright © 2004 Emerald Group Publishing Limited. All rights reserved.
ISSN
1368-5201
DOI
10.1108/13685200410810047
Publisher site
See Article on Publisher Site

Abstract

Explores views on the costs and benefits of financial institution compliance with money laundering regulations as a precursor to a full cost benefit study. Notes that there is very little information on the costs and benefits of money laundering, which is linked with the difficulties of estimating the volume of money laundering that is occurring. Deals with attempts to measure money laundering; the problems involved in this have resulted in a system and procedure based approach which focuses on input rather than output and is clearly inferior. Looks at the costs and benefits for private compliance with money laundering regulation. Moves on to the UK’s money laundering control system, which is based on the Financial Services Authority; financial institutions have to file suspicious activity reports (SAR( and to know their customer, but it is not clear that statistics on these activities show more than the companies’ compliance. Concludes that the industry regards these duties, ie of policing the regulations on behalf of the government, as a burden, and that if this is regarded as excessive, there will be a deterrent to cooperation.

Journal

Journal of Money Laundering ControlEmerald Publishing

Published: Oct 1, 2004

Keywords: United Kingdom; Money laundering; Cost benefit analysis; Financial institutions; Regulation

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