Four ways to safeguard business from financial crime

On your first day, you're eager to impress, so when your new boss tells you they have deposited some money into your account and all you need to do is go to your local Western Union and transfer the money to an account somewhere in Eastern Europe, you're keen to get the job done.

"Safeguarding our communities is a joint responsibility and one where we can all play a role by taking a few simple steps."
Mark Evans, Chief compliance officer, ANZ

You transfer the money, completely unaware it was acquired illegally. And, unwittingly, you've become complicit in money laundering. The dream job is now a nightmare.

As Chief Compliance Officer at ANZ, this so-called 'money mule' scheme, in which innocent people are tricked into laundering money after being hired for bogus jobs, is just one example I see among many of the increasingly diverse schemes criminals use when trying to make bad money appear good.

While the activities of organised criminal gangs can make good headlines and movies, I am certain the overwhelming majority of people strongly believe in doing the right thing. For Australians like me, the idea of fairness is as ingrained to our national psyche as sport, sun, sea and surf.

So it came as something of a surprise to see Australia labelled a 'major money launderer' by a recent US Government Department report. Australia was named alongside the UK, USA, France and Germany as regions of “primary money laundering concern".

Is that a label which stands up to scrutiny? Is Australia a law-abiding nation or are we the delinquent in the international community?

Obligation to protect

As in any developed country, no-one would deny organised crime is an issue in Australia. The US report highlights the Australian Crime Commission's estimate that serious and organised crime costs Australia near to $15 billion each year, with money laundering a key enabler of this.

When you combine this with the fact Australia has one of the largest pools of consolidated assets under management globally (valued at $A2.35 trillion) and is a major destination for foreign direct investment, it's perhaps less surprising we make an attractive target for criminals seeking to use our financial system to legitimise the proceeds of crime.

Many of us, not just in Australia but throughout the region, enjoy a spot of gambling and while most of us can sensibly enjoy the odd wager, casinos and gambling can also make perfect locations to launder large sums of cash.

It's a threat every financial institution treats very seriously. We have all seen the enormous fines and reputational damage suffered by financial institutions who have breached anti-money laundering legislation.

In the financial world, we have an obligation to protect our customers and a duty to do the right thing by the wider community. Working with law enforcement agencies, educating our employees and customers and ensuring our processes and systems are robust are all important elements in helping to prevent criminal activity.

That's why it was heartening to also see that the report praises the work we do here in Australia to detect, prevent and prosecute money laundering. Along with regulators, law enforcement agencies and our colleagues in the financial world, we are working tirelessly to do everything we can to eradicate money laundering.

Individual obligations

Countering illegal activity is most effective when we all work together. Safeguarding our communities is a joint responsibility and one where we can all play a role by taking a few simple steps.

• Stay alert and report any suspicious behaviour or activity. Most organisations have well-defined channels for reporting suspicious behaviour, so make sure you know what they are and how to use them. Importantly, don't be afraid to speak up.

• Keep up with the latest trends and developments. The tactics criminals use to attempt to enter stolen funds into the financial system or defraud people are changing all the time – keep an eye on current affairs and any communications you receive from your financial institution for things to look out for.
• Sign up to your bank's social media channels. Social media can be a useful source of information about the latest threats and scams criminals are using. At ANZ we use both Facebook and Twitter to highlight these to our customers and employees.
• Be aware too of social media. Social media however can also be used by criminals to attempt to trick people into sharing sensitive information so stay alert and avoid any offers which look too good to be true.

Mark Evans is chief compliance officer at ANZ.