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Money Laundering: Going After the Bad Guys

With us is Todd Cooper, vice president of Wolters Kluwer Financial Services' Financial Intelligence Unit.

DDJ: Todd, if we're to believe everything we see on TV and in movies, online money-laundering is a big deal. Is that the case?

TC: Money laundering is a critical phase of much criminal and terrorist activity and is intractable global problem. According to the FBI, 2-5 percent of the global BDP is attributable to money laundering, so yes, it is a very big deal.

DDJ: So what are we to do? Who are the "good guys" and how do they combat the "bad guys"?

TC: Financial services institutions have been deputized to proactively prevent known criminals and terrorists from using their services by monitoring the behavior of their customers and reporting to the appropriate authorities suspicious activity and specific financial transactions that present higher risk profiles. In the U.S., the FBI and other federal, state and local agencies use this data to support their on-going criminal and terrorist investigations as well as initiate new investigations based on patterns of data.

DDJ: It would seem that the "good guys" need to be experts in technology and expert in financial issues. How do you train someone to be an anti-money laundering (AML) investigator?

TC: To adequately attack this problem, financial service institutions need to use transaction monitoring and customer risk management technologies to effectively and efficiently meet their obligations. AML investigators must be financial forensic experts, able to recognize the transaction patterns of various money laundering, fraud and terrorist financing schemes. It is not a skill that is easily acquired, and there is a nationwide and even worldwide shortage of expert investigators. There are many strategies for training these individuals, but we believe simulating a true forensic financial scenario results in the quickest and most effective path to helping investigators to become experts.

DDJ: As money laundering techniques change, it would see the training game would change too. Is this the case?

TC: Wiz Sentri: Virtuoso, our AML training simulator, is updated on a quarterly basis with new money laundering scenarios. As new schemes are found in the market, the system is updated to provide new and even expert investigators the simulations they need to uncover these new schemes within their own organizations' financial transaction information.

DDJ: Where would readers go to learn more about this AML?

TC: There are many resources on the web, so a Google search is a good place to go for general information on money laundering. The FBI and other government sites have fascinating details on the war against money laundering and are good resources for those who would like to dig in deeper. Readers can also check out the Wiz Sentri: Virtuoso AML training simulator and Wolters Kluwer Financial Services' Financial Intelligence Unit.

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