Lyons Blog

The United States Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) promulgates and enforces rules designed to prevent and detect money-laundering activities.

When thinking of anti-money laundering (AML) requirements, most people automatically think of banks, credit unions, investment firms and other financial institutions whose primary “product” is money. However, AML requirements are not limited to these types of institutions.

Although some would argue that casinos are primarily in the business of providing entertainment, casinos actually pose a serious risk for money-laundering activities. As such, they are subject to a dizzying array of AML regulations, including the Bank Secrecy Act (BSA) rules.

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In 2009, the total global revenues from international criminal activities were estimated at U.S. $870 billion per year. Since then, the rise of cybercrime and use of digital technology to circumvent existing laws and eliminate protective barriers has almost certainly caused that number to rise. In short, criminal business is often a very lucrative business.

The cost to society of all this crime is equally high. Each year, countless lives are lost to human traffickers, drug dealers, smugglers, money launderers and other miscreants. In less secure areas, international criminal activities can destabilize emerging economies, up-end struggling political systems and threaten the peace of entire regions.

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As global commerce, terrorism and financial crimes continue to rise in number and scope, it is critical for financial institutions and insurers to have adequate compliance programs in place to prevent inadvertent violations of the law.

In addition to being subject to a myriad of industry rules and regulations, insurance companies are obligated to comply with the rules promulgated under the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC).

One of OFAC’s rules is a requirement to screen proposed policy-holders, existing customers, employees and business partners by checking names against the list of Specially Designated Nationals (SDN). The SDN list, which is updated regularly, contains thousands of names of individuals, organizations, companies and countries with whom U.S. persons (including insurers) may not conduct business.

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Businesses that are looking to support same day ACH may be interested in NACHA’s recently released essentials guide. If you’re unfamiliar with same day ACH, it’s expected to increase the speed of ACH payments by allowing both sending and crediting of payments on the same day. This becomes effective on September 23, 2016. The guide itself discusses the opportunities, benefits, and value that same day ACH is expected to provide.

“The purpose of the ‘Essentials Guide’ is to enable payables and receivables decision makers to initiate conversations in their organizations,” said Rob Unger, Senior Director of Product Management and Strategic Corporate Relations at NACHA. “Same Day ACH will affect every business that currently uses the ACH Network.”

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