Money laundering and terrorist financing schemes might seem like activities you'd only see on television. But they can, and do, strike credit unions.
The criminals conducting these activities don’t discriminate against financial institution type, asset size, or location. Anyone can be a victim.
That's why credit unions must closely observe member activities to prevent money laundering and terrorist financing from inflicting damage on members, communities, and your reputation.
For credit union staff who live and breathe the Bank Secrecy Act (BSA) and anti-money laundering (AML) protocols, identifying suspicious activity is second nature. But staff not exposed to these guidelines on a daily basis might have a more difficult time.
Appendix F from the Federal Financial Institutions Examination Council (FFIEC) BSA/AML Examination Manual provides a list of suspicious activities that could indicate money laundering and terrorist financing.
Watch for these warning signs from individual or business members that might indicate money laundering:
Activities that might indicate terrorist financing include:
This is a small sample of the types of suspicious activity that could indicate potential money laundering and terrorist financing.
Member service representatives must recognize these activities and understand your credit union’s internal procedures on reporting suspicious activity. With a bit of observation and knowledge of these procedures, you can make a huge difference in stopping the perpetrators of these financial crimes in their tracks.
This article initially appeared in Credit Union Front Line Newsletter, which the monthly sales and service newsletter for branch staff and their managers. Subscribe now to the print edition or PDF version.