1. Policy push for tighter regulation of Companies House could be delayed. There are massive overhauls across the globe in the public registers for companies. The UK and several other nations are campaigning to make identifying ultimate beneficial owners (UBOs) clearer andmore transparent. While this is happening in some countries, in others there is an increasing appetite for more privacy, such as with the European Union Court of Justice’s recent ruling in Luxembourg with regards to beneficial ownership of companies. The recession and this time of low economic growth may distract the policy push for tighter regulation of Companies House as the government wants to incentivise inward investment. 3. Technology will continue to make AML processes quicker and more efficient. Technology has the ability to speed up the time it takes to verify entities and individuals and will exponentially increase productivity across the AML sector over the next few years. The best thing about regulation is that it affects not only your business, but all of your competitors in the same way. This means that if you can streamline your businesses by processing tasks quicker, cheaper, and more effectively, it will lead to more satisfied customers and happier staff (who hate doing manual AML). Businesses have the opportunity to use compliance as a competitive advantage. 2. The Real Estate sector will remain a hub for money laundering. Real estate remains one of the faster-growing sectors for money laundering across the board, and the trend is expected to continue into 2023. Real estate is an attractive method of money laundering in many ways. It’s a great way to clean significant sums of money, it can be leveraged at a later date, and plenty of firms that operate in the sector have notoriously poor structures which prioritise faster transactions over compliance. We see significant amounts of cash in the form of ‘donations’ from other parties being used as home deposits across the UK that are difficult to verify and trace, and that trend is only increasing. 4. The recession could increase money laundering, with companies less likely to scrutinise transactions and more likely to deprioritise compliance staff. The biggest problem with money laundering is that it is inadvertently highly profitable for reporting entities. Because of this, firms may be more willing to deal with higher-risk transactions and scrutinise these transactions less. This is especially true if they are high-value, which money laundering transactions usually are. Recessions could also lead to firms de-prioritising compliance staff, who are already overworked at the best of times, exposing them to worse compliance processes. Bank i ng & F i nanc i a l Se r v i ce s 36 Finance Monthly.
RkJQdWJsaXNoZXIy Mjk3Mzkz