AML policy in action
AML policy is a basis for procedures and controls that is carried out by Legal Compliance Department (LCD). AML procedures are applicable not only to bank and financial institutions that provide transfers directly, but also to consultants providing services, which are well informed of client`s activities. The European Commission has developed general guidelines with the list of transactions showing factors, explaining how to identify suspicious transactions. There is no threshold when transaction can be identified as a suspicious. The situation must be analyzed on case-by-case basis. Each factor regarded separately, might look seamless, but when observed together, it may arouse suspicion that the transaction is related to money laundering offence. Compliance department must know the client, inter alia, nature of business, usual quantities of transfers, financial history and background. If transactions do not appear to be in line with regular business practice, it might be a relevant factor for establishing the fact that transaction looks suspicious. That is the reason why banks have recently drawn attention to and carried out intensive supervision of newly introduced clients.

AML policy strategies
Examples of commonly acknowledged indicators are: client transfers funds in big amounts without payment details or receives funds in big amounts without payment details. The client presents confusing details about the transaction or knows very few details about its purpose. The client requests an express transfer and insists to make the transfer fast or he/she makes transactions at different physical locations trying to avoid detection. The client arbitrary informs about large volume transactions, using unconventional bookkeeping methods or off-the-record books. The client does not react on invitation to meet in person; normal attempts to verify the background of a new or prospective client are difficult. The client uses post box service instead of real office or he/she appears to have recently established a series of new relationships with different financial entities, etc.

Applicable methodology may differ depending on organization, though the basic principles should be common, for example, large cash transaction reporting, recordkeeping, background checks, case management tracking system; incident reporting database, corporate 'hot file', etc.

Sometimes companies on business start-up stage face certain difficulties. E.g., to fill the client’s questionnaire being unable to show it to any business collaborates, since the business is new and agreements are not concluded yet. Therefore, it is possible to upgrade the client’s questionnaire later, in order to keep the bank informed on planned activities. At the moment of account opening, the bank must verify the source of income and origin of funds.

https://www.confiduss.com/en/services/corporate/legal/aml-policy/