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Money Laundering in companies

By: Daily Postal - Nov.25, 2019 5:13 pm

Legal money is an extremely relevant element and this is where companies join the fight against illegality and the crime of money laundering.

In a globalized world where money transfers between companies and people happen all the time, it certainly requires greater challenges when we´re talking about negotiations and business in general; regardless of the market and industry they belong to.

But, what is money laundering? The UIAF (Financial Information and Analysis Unit) in its document ‘What you should know about money laundering and terrorist financing’, define it as:

The modality by which criminal organizations seek to give the appearance of legality about the resources they obtain from their illegal activities, by incorporating them into the legal economic system“.

Also, “through this activity, criminal gangs manage to make use of these assets without jeopardizing their reinvestment in new illegal or lawful activities“.

On the other hand, the concept of terrorist financing is described as “financial support, in any form, for terrorism or for those who encourage, plan or are involved in it. It should be borne in mind that it is difficult to define terrorism itself, because the term can have political, religious and national”.

Furthermore, money laundering and terrorist financing have similar operations characteristics, especially referring to concealment, but those who finance terrorism transfer funds that may have a legal or illegal origin, covering up their main source and final destination”.

Some of the benefits of implementing a proper system money laundering prevention and terrorist financing are:

It is important to recognize the critical importance of preventing money laundering and terrorist financing regardless of the industry or market

  • Avoiding penalties and fines for violating internationally established standards.
  • Protecting the organization from possible external relations that may affect the reputation at a national or international level.
  • Protecting the organization from risks of money laundering and terrorist financing.
  • Identifying unusual and suspicious operations in order to take action on time.
  • Sending alerts that help keep the company aware of everything that is happening in case one of the risks become reality.

As a result, many organizations have begun to recognize the importance and sensitivity of this matter, through risk management and implementations of control systems that contribute to minimizing and mitigating these actions.

The GAFI – in Spanish- is an intergovernmental entity established in 1989 whose objective is to set standards and promote the effective implementation of legal, regulatory and operational measures to combat money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction, and other threats regarding the integrity of the international financial system.

International control entities have focused on companies focusing on complying with regulations against the prevention of money laundering and terrorist financing, to reduce the impacts they may have on a country’s economy and the enactment of crimes related to this.

For instance, SuperGIROS, a money transfer company, is a clear reference to what’s mention above. As a Postal Payment Operator in Colombia and since its inception in 2016; it maintains policies against the crime of money laundering and reaffirm its commitment to prevent it, complying with the provisions of the law and adopting international best practices such as the ones issued by the International Financial Action Task.