In this series of podcasts, our host Stephen Platt will interview key figures in the world of financial crime prevention and examine successes and failures in the global fight against money laundering and related crimes including drug trafficking, bribery and corruption, sanctions evasion, human trafficking and tax evasion.
Episode 25: KYC360 AML Talk Show host Stephen Platt interviews guest speaker Mike Parker, Former US Federal Prosecutor and Money Laundering & Economic Sanctions Expert.
(This is an excerpt, you can find the full transcript and episode here)
Stephen Platt:
But to go back to the corporate and trust administration example I gave a few moments ago, if you’re administering a company, you should also be screening all of the individuals that are connected, for example, with a parent or a subsidiary or counterparty for that matter.
Mike Parker:
Absolutely.
Stephen Platt:
Am I missing the point there, or what would your view on that be?
Mike Parker:
No, I think all of that is absolutely correct. To your first point, awareness, I would characterize it as care about compliance. If you care about compliance in the first instance, then, in all honesty, you’re ahead of the game. Being aware, actually wanting to comply with this, I think really will set you as a business person in the right direction of setting up the necessary safeguards to screen.
Mike Parker:
I would also say too, without sounding like a commercial for your company, really having the right software in place and looking at compliance as more than just checking the boxes. I think the more robust look, as you described it, in looking at counterparties to transactions, at looking at subsidiaries of companies, of really knowing who you’re doing business with, what you don’t know will hurt you in the OFAC realm. It just will because there is this strict liability that OFAC applies.
Mike Parker:
And the ever present fear of an actual designation by OFAC, which, look, as you described it, I mean it really can have a reputational harm that even if you get off the SDM list will follow you around. I think the stakes are high enough to where if you’re in the international trade, international finance realm, you’re leaving yourself open to so much vulnerability if you don’t care about this issue.
Mike Parker:
And so, go out, purchase screening software. Do your due diligence on who you’re doing business with. Know what you’re getting into if you’re buying a company. Know who you’re getting into a business relationship with if you’re starting a new , I guess, partnership with another company, particularly one in a different country. Really, all of these things.
Mike Parker:
But it’s not just about checking the boxes. It’s about really knowing what their line of business is. If you’re involved in something such as the oil and gas industry, or making parts for the oil and gas industry, you just have to be aware that there is so much sanctions evasion that happens in this area. You are foolish if you’re not taking the necessary precautions to look into where your goods are being sold, where they’re being re-exported to.
Stephen Platt:
Yeah. You’re really inviting trouble if you don’t do those things, as you say. I mean you refer to a screening software, something that I know a little bit about. But obviously, as with any system, it’s only as good as really two things. It’s only as good as the technology itself, but also the data, i.e., the data sets that you are screening against.
Stephen Platt:
One of the things that never ceases to amaze me is the way in which some organizations screen only against certain sanctions regimes. If you’re going to go to the trouble of screening, you’ve got to make sure that you screen against the most accurate and comprehensive datasets, which really should include every sanctions regime.
You can find the full transcript and episode here.
