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| Friday, 25 June 2004 |
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Identifying early signs of money laundering by Irangika Range A Bank's main target is to identify early signs of money laundering in order to prevent potential damage to its reputation and getting to know customers, said USA, HSBC Bank Senior Vice President Hersel Mehanic. He was making a presentation on "Know Your Customer system (KYC) and Anti Money Laundering system (AML). He said AML is the process by which one conceals the existence, illegal source or illegal application of income. It is the process by which the launderer disguises the illegitimate nature or the source of income to make it appear legitimate. The workshop was organised by the HSBC local branch under the theme of Global Payments and Cash Management at The Colombo Plaza on Tuesday. He said the workshop helps especially the local banking sector to enact its own AML legislation in future. "We should understand International standards of the AML system when entering international trade. It involves three stages. Illegal funds are physically disposed through strategic placements in financial institutions and layered through complex transactions to dislodge them from its illegal sources before integrating it back into the economy, " he said. "The presentation comprised the US AML legislation and international efforts being taken to combat money laundering based on the Basle Principles. The Basle Principles statement of 1988 describes how the international banking community cooperates to combat money laundering comprising specified customer identification steps, emphasis on legal and ethical compliance, greater cooperation with legal authorities and commitment to its principles," he said. He said instances of money laundering could be tackled through proper deterrent procedures when opening accounts and maintaining proper documentation for a bank to know its customers. " The KYC and AML procedures help to establish the prospective customer's identity, to obtain a reference from a party acceptable to the client, to understand the prospect customer's background, history and income and to understand the prospective customer's assets and liabilities situation," he said. USA, HSBC Bank, First Vice Precedent Richard Boyle explained the US dollar payments and cash management capabilities of the HSBC group. " A US dollar clearing solutions targeted with many values needs such as client focus, excellence, capability to meet diverse business requirements, consisting of quality, reliability and value," he said. He said the HSBC solution plays a key role for the product development in the banking sector. He outlined the advantages of the HSBC solution comprising good local, regional and global client service, multi-channel robust reporting capabilities and industry leading contingency. |
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