Most talks and articles on AML (Anti Money Laundering), KYC (Know Your Customer), KYB (Know Your Business) and the importance of regulatory compliance focus on the negative effects of money laundering afflicting financial institutions and the economy at large, not mentioning the most vulnerable in this - the victims of every heinous crime that generate dirty money.
Hefty fines and penalties are stoved upon those regulated companies who fail to comply with the regulatory requirements of AML, KYC, and KYB. Still, they're lucky compared to the victims of human trafficking, illegal wildlife trade, drug trafficking, smuggling, prostitution, arms trafficking, illegal gambling, and terrorism. These are just some of the crimes associated with money laundering, none of which are without its unfair share of innocent victims. The rules and regulations set to combat money laundering, financing terrorism, and other financial crimes don't exist simply to facilitate safe business, their main purpose is to reduce crime, thus protecting all people.
Crime does not pay without money laundering
Money laundering make illegal property appear as legitimately acquired, enabling criminals to take advantage of their crimes and use that money in their daily lives without arousing suspicion. The negative effects of money laundering on the economy; growth rates, income distribution, tax revenues, financial institutions, and more are severe. Still, this doesn't account for the value of human life and the often abusive and inhumane methods used by criminals to acquire their money. One must never forget that the dirty money and the blood money which criminals launder in our financial systems has an invisible trail of countless innocent victims behind it. The profits from e.g., drug or human trafficking are being drawn out of blood, sweat and tears of the innocent. There are people who are privileged enough to never be at risk of being exposed to certain crimes, terrorist acts however affect us all.
Terrorism unfunded
Terrorism is financed with money of illegal origin as well as with legally acquired money. In the case of terrorist financing, it is mainly the ultimate purpose of the money that the criminal tries to hide, unlike money laundering where the purpose is to hide the origin of the money. Terrorist financing is often more difficult for banks and other companies to detect and identify, especially if it is done with legal money. The two quite different types of crime, money laundering and terrorist financing, share a common denominator - the perpetrators make extensive use of the financial systems to achieve their goals and objectives. Therefore, they can also be combated with similar methods and be addressed in the same legislation.
Challenges met and overcome with ZignSec
It's not that regulated companies aren't motivated enough to comply with the regulatory requirements of AML, KYC and KYB - in the light of the humanistic aspect it would take a callous mindset not to be. But the extent of regulatory compliance processes that need to be implemented, digitized, and optimized is putting a lot of pressure on businesses as it is time-consuming and costly with little to no margin for errors. On top of this, there's an endless amount of cross-border compliance challenges for companies conducting or expanding their business abroad. Checking investment proposals for country-specific restrictions to sourcing compliance information that is up to date, accurate, and reliable, is a cumbersome and never-ending process. It is not due to lack of motivation that so many companies find themselves astray in this, it is due to lack of regulatory knowledge and not knowing who to turn to. All they need to do is contact ZignSec.
ZignSec is an aggregator of identification and compliance solutions for businesses and offer them as a single endpoint and suite of tools. The ZignSec platform makes it easy for businesses to replace manual and cumbersome processes with digitised and automated workflows for KYC/B & AML checks, age verification, fraud detection, and onboarding. Managing cross-border compliance does not have to be low-tech and resource-intensive, nor does it have to come with spiralling budgets or restricted expansion plans. ZignSec is a for regulatory compliance and cross-border compliance in all areas of business, making it possible for all companies to be at the frontline of the economic battle against criminals and terrorists.