Red Flag indicators

11 Dec Red Flag indicators

During the lifespan of a relationship with a customer as an analyst or relationship manager you should always be aware of the following behaviours that indicate a customer might be undertaking money laundering or terrorist financing.

We list some of the red flags or indicators to be aware of at the time of performing an initial onboarding of a new customer:

• The client contact is overly secretive or evasive about who is the actual underline client
• Uses an email address from a domain such as Hotmail, Gmail, Yahoo etc, with an explanation that their business email address is not currently working
• The person actually directing the operation is not one of the formal parties to the transaction or their representative.
• Unreasonable complex ownership structure with multiple layers across different jurisdictions
• Other types of Red Flags at the Onboarding stage can be:
• The client contact is reluctant to provide or refuses to provide information, data and documents usually required in order to enable the transaction’s execution
• Provides false or counterfeited documentation
• Cannot be found on the internet or the website doesn’t seem to fit with the client explanation of their product and services

What to do if you come across something suspicious?

A red flag on its own is not an indication of money laundering however if you are suspicious about the activity or customer you should raise this to your AML Compliance Officer or Money Laundering Reporting Officer also known as the MLRO.