This week’s Secret Crime Fighter discovered money laundering typologies being run through its savings and investment product. The typologies are an example of how financial criminals find ways to launder funds, even through seemingly low risk products.

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The Typologies

Saving Money

Our Secret Crime Fighter provides savings and investment accounts. Money can be moved into the account by direct debit, either from a personal account or from another savings and investment product.

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Once the money is in an account, it can only be withdrawn back to the source account, or to a new verified account. A new account can be verified either by provision of a bank statement, or by our Crime Fighter sending a coded payment to the account, and having the customer repeat the code back.

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Not Saving Money

Investment and savings accounts can be appealing to criminals attempting to launder funds because they can add a number of complex layers by simply moving the funds between investment providers.

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Our Crime Fighter started to notice that some accounts were seeing high turnover of funds within the space of a month or two; often, £5-20k was being moved out of the account within a month, to new verified accounts or to other investment providers.

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In addition, the other savings providers, where the source money was coming from, would get in touch and alert our Crime Fighter to the fact that the source funds were fraudulent.

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Stopping the Typology

The controls that our Secret Crime Fighter had in place were good at stopping their genuine customers from being defrauded - the coded payments. But to stop their accounts being used for money laundering or for receiving fraudulent funds was slightly harder. Transaction monitoring rules looking for quick turnover of funds were implemented, as well as enhanced due diligence on the incoming payments.

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Thanks for reading our latest Secret Crime Fighters newsletter. If you have an interesting typology that you’d like to share, we’d love to hear about it! Please email us at [email protected].