Letters: Grappling with dirty money
[Re: Credit Suisse becomes first Swiss bank to be convicted in Switzerland’s own courts, June 27]
The FCA is concerned crypto firms don’t have the adequate processes in place to identify and prevent money flows into illicit activities, from money laundering to terrorist financing. While the FCA’s concerns are warranted, we should not see this as an issue solely confined to the cryptocurrency market.
The reality is that major financial institutions are regularly embroiled in legal cases linked to financial crime. Earlier this month, Credit Suisse was put on the FCA watchlist, in part a result of the bank’s involvement in risky transactions that are not internally challenged. Dirty money is a systematic challenge that requires a global response. In the EU, law enforcement officials estimate that professional money launderers have a 99 per cent success rate in running criminal profits through the existing financial system. In the US, 1 per cent of financial proceeds of crime is recovered each year.
The FCA needs to work closely with both traditional finance and decentralised finance companies, taking a holistic approach which tackles financial crime risks across the entire sector. This includes implementing a regular review of monitoring processes and assessing firms’ use of technology to rapidly process data and identify suspicious transactions.
Requiring financial institutions and firms in other high-risk sectors to put effective systems in place to counter financial crime in practice must be a top priority for the FCA.
Max Heywood