#QuickBiteCompliance Day 63
How “Banking for Banks” Can Help or Hurt the World 🌍💸
Imagine your bank needs help moving money to another country. Instead of doing it alone, they ask a bigger, international bank to help. This is called Correspondent Banking. The big bank (the “correspondent bank”) helps smaller banks (the “respondent banks”) with services like:
💵 Moving money internationally (wire transfers)
💳 Exchanging one currency for another (like dollars to euros)
📬 Sending checks across borders
Sounds great, right? It helps people and businesses around the world stay connected! But here’s the problem: bad guys can use this system to do illegal things, like:
🚨 Hiding Stolen Money: Criminals might send dirty money through several banks to make it look clean.
🚨 Funding Bad Activities: Money can be secretly sent to fund illegal activities, like terrorism.
🚨 Fake Businesses: Some bad guys set up fake companies to trick banks and move money for crimes like drug trafficking.
For example, let’s say there’s a bad guy in one country who wants to hide stolen money. He sends it to a small bank, which then sends it to a big bank in another country. Along the way, the money gets moved so much that it’s hard to tell where it came from.
How can we stop this? Banks need to:
🔍 Watch transactions closely to spot anything suspicious.
🤝 Work together and share information about risks.
🛠️ Use tools and technology to detect unusual activity.
Let’s keep the financial system safe for everyone!
#AntiFinancialCrime #CorrespondentBanking #AML #FinancialSecurity #FraudPrevention #InclusiveRegtech #OpenSourceAML
Source: https://www.acams.org/en/resources/aml-glossary-of-terms
