this post was submitted on 11 Jul 2023
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Speaking for the UK, that's every financial institution. The whole point is that everyone is required to complete checks to make sure you are who you say you are, if you refuse them then that is an indicator of money laundering. Even just receiving and returning money helps a money launderer establish a paper trail and assists in layering to legitimise the money they gave you. That's a big no-no, obviously, so it can't simply be returned without risking significant legal implications from the regulator. All expectations are set up front on this when beginning transactions.
I understand that's the law as it currently is. I'm saying that it shouldn't result in any legal ramifications.
It seems they weren't well setup, if they were then he wouldn't have gotten to the point that he wired money before filling the required paperwork out.
Okay, do you work in the UK financial services industry, or an associated regulatory body? Because this was an infrequent circumstance that came as a result of the inattentiveness and belligerence of specific customers. There's no industry wide issue and this was whilst working for one of the largest investment platforms in the UK.
If you don't like how things work, then that's fine, but it was working as intended and would have been no issue if the client had just followed the required, and explained, process. I feel it goes without saying that it is very important to maintain anti-money laundering processes in our financial systems, both legally and conceptually.
I'm not saying it's a common issue. I'm saying that something like this should never occur.
I'm also not saying that I don't value anti money laundering process. I agree those are very important.
However, I also think it's even more important that people aren't deprived of their money without due process. If you can't accept it, because they're not proving the required evidence then you should be required to return it unless there's more to it. In order to keep the money, there needs to be some form of evidence showing money laundering not just an absence of evidence altogether.
If you receive money without verification and return it no questions asked, then you are opening yourself up as an avenue by which people can launder money. Every receipt and retransfer of that money legitimises that money further and makes you party to the crime. The money is in limbo and can be returned as soon as the regulatory needs are met, but to do otherwise just voids the whole process.
At this point they are depriving themselves of the money by refusing to verify themselves, it's a basic identify and address check. This is an investment company, they weren't sending us their rent money, they wanted to invest it. They were just pissed that we expected them to follow the same process that every client needs to follow when investing.
It doesn't void the whole process. It may very slightly increase the degree to which it's easier to launder money (I'm not convinced on that aspect since the money already originated from within the banking system).
Rather it prioritizes people's right to their own property.
What you're saying makes sense to me if you're talking about a deposit of cash that was mailed. It doesn't make sense to me for a wire or electronic transfer.