Money laundering is not always obvious but the consequences are serious and more than 200,000 reports of suspected money laundering are submitted annually to authorities in the UK. Money laundering behaviour is typically connected to money acquired through criminal and, possibly even, terrorist activity. When you are aware of the stages of operation, it can be easier to know how to spot money laundering when it is happening so that you can report it properly and safely. The Proceeds of Crime Act requires businesses within the regulated sector of banking, investment, money transmission, etc. to report any suspicious financial activity to the authorities, whether they suspect staff or customers.
If you are unsure of how to spot money laundering or how to report it when you have noticed it, suspicious activity can be reported to HMRC or, if the activity is within your company, to your nominated officer. For more insight into spotting the signs and how to report it, please continue reading.
How to Spot Money Laundering
Vigilance is key when it comes to detecting suspicious financial activity. Familiarise yourself with the key signs to look out for when it comes to suspicious behaviour within your own company, from your clients, or elsewhere:
- Unusual transactions or financial activity which seem out of character compared to normal behaviour
- Large cash deposits or bank balances with little or no solid justification of where the funds came from
- Cashier’s checks or money orders purchased with large sums of cash
- Evasiveness or defensiveness around financial information or details when asked for them
- Discrepancies in information such as multiple or unverified identification documents
- Complicated financial transactions to confuse or throw investigators off the scent by hiding the source of the funds
How to Report Money Laundering
If you think you have spotted any of the signs of money laundering within your company, there are certain steps to follow to report the suspicious activity. For businesses regulated by the Money Laundering Regulations, you must appoint someone in the business to be a ‘nominated officer’. If you are a regulated sole trader with no employees, you must act as the nominated officer yourself. It is the role of the nominated officer to educate and inform staff of money laundering regulations.
Any suspicious transactions or activity must be reported to the nominated officer who then decides whether a Suspicious Activity Report (SAR) is to be sent to the National Crime Agency (NCA). It is also the nominated officer’s responsibility to suspend the suspicious transaction if they think it is linked to money laundering or terrorist financing. For further guidance regarding reporting suspicious financial behaviour, our team of fraud barristers are here to advise.
Whether you or your company have intentionally or unintentionally been implicated in money laundering activity, it is important to seek legal advice from an experienced fraud lawyer as soon as possible to avoid facing money laundering penalties. Our fraud barristers are recognised experts in financial fraud cases. Contact us today for support with your case.