Human trafficking ‘serious concern’ for FIs

Human trafficking is now one of the most pressing concerns for compliance professionals across the world, according to the latest anti-money laundering study from BAE Systems.

The research surveyed 452 banking and insurance professionals working in risk management and compliance across the UK, USA, France, Germany, Australia, and Singapore.

It found that 77 per cent of compliance professionals are not confident that money laundering crimes linked to human trafficking could be stopped from passing through their customers’ accounts.

More than 62 per cent of respondents said that advanced, new criminal techniques have become even harder to spot in the last 12 months and the financial impact on banks has been huge.

In the UK, a quarter of risk and compliance professionals within financial institutions said that human trafficking was causing the largest financial losses of all anti-money laundering crimes.

In the US, it was a third and in Australia it was nearer half (45 per cent).

Alongside fraud, corruption and organised crime, human trafficking has been cited as a top five concern, with 25 per cent of those questioned admitting that it is a serious worry.

26 per cent said that their teams struggled to identify the key indicators linked to human trafficking and 28 per cent do not have enough anti-money laundering intelligence within their organisation.

“For many financial institutions, getting a handle on money laundering is now simply about ensuring they avoid fines or reputational damage,” said Enda Shirley, head of compliance at BAE Systems Applied Intelligence. “Our research is telling us that the current system just doesn’t go anywhere near deep enough to have a significant impact on the crux of the issues.

"For many, compliance has gotten in the way of the primary goal – how to identify and protect vulnerable victims.”

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