What is money laundering
Briefly explained, money laundering is actions taken to hide the fact that money, property or profits stem from criminal activity.
- The concept covers actions such as receiving or securing money from criminal activity for yourself and others as well as transporting, keeping or in other ways helping to secure money stemming from criminal activity.
- All forms of money laundering are illegal – including attempts to launder money as well as contributing to money laundering and laundering money from criminal activity performed by yourself and others.
- The purpose of money laundering is typically to disguise the source of money and to make illegally made money appear legitimate – making “black” money “white” so it can be spent freely.
- One method of money laundering is to channel money through a myriad of accounts and banks, but it can also take place through simple money transfers. Along the way the money may for instance be exchanged into another currency, lent to companies or spent on buying real property.
- When the money is ultimately deposited in an ordinary bank account, its criminal origin is so difficult to trace that the money appears to have been legitimately earned.
- Read more about the EU legal framework on anti-money laundering here.
If we detect something suspicious on the customer’s account, an alert will be triggered in the monitoring system or with the personal banking advisor. We investigate the matter by checking whether other account movements break the normal activity pattern. If we do not find a good explanation, and in case of further suspicion, we hand the case over to one of our specialist teams for a more detailed investigation. If this process confirms our suspicions, we report the case to the authorities and cooperate with them in the further investigation. In these types of cases we also consider whether we terminate the customer relationship.
Our work to prevent money laundering starts even before we accept a new customer. To identify and to get to know our customers we ask a number of questions and require documentation. We must for instance make sure that they are who they claim to be. We also need to know the source of their money and how they expect to use their accounts. Based on this information we assess the financial crime risk associated with having them as customers. It is important for how we will later monitor their accounts. After the risk assessment, the ongoing monitoring by employees and IT systems starts.
As a bank we want to know our customers. Therefore, we ask our customers to answer a number of questions about who they are and how they plan to use the bank’s products and services. For instance, we must ensure that our customers truly are who they say they are, that we know the source of their money and how they expect to use their accounts.
The questions we ask our customers to answer play a vital role in our defence against money laundering and help us protect the bank and our customers from being used for financial crime. By answering these questions, our customers help us comply with the laws and regulations and more importantly contribute to a safer financial environment for all of us.