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Money Laundering

Money Laundering

Money Laundering

Opinion FD

Amsterdam, March 15th 2022– In their fight against black money, banks are increasingly focusing on the use of cash. Entrepreneurs are allowed to withdraw and deposit less and less money or are told that the use of cash will be banned altogether.

In sectors such as the metal trade and border regions where a lot of cash is still used, the new measures are driving entrepreneurs to despair. They cannot switch to giro as quickly as the banks want and fear losing their bank account and therefore their business. Cases are pouring in to lawyers.

It is logical that banks look critically at the use of cash. The origin of cash is much more difficult to trace than cashless transactions. Criminals who want to launder profits from the drug trade often do this by making large purchases with bills. Of course, banks should not facilitate this.
In the Netherlands, €16 billion in criminal money is laundered annually. Because we as a society do not want that, banks have been put forward as the detectives who have to fend off these criminal money flows.

In doing so, financial institutions are becoming increasingly rigorous, terrified of making a mistake. After all, if they don’t do it right, there is a risk of fines of hundreds of millions, the wrath of politics and society and even prosecution of administrators. Banks partly owe this to themselves because for years they did little to keep out criminal money.

However, the side effects of the increasingly stringent policy are now becoming apparent. Entire sectors are excluded from the banking system, companies are inundated with questionnaires, and have to conduct research that shows that customers, suppliers and other business partners are not involved in shady practices.

As a result, the obligation to investigate and the costs for this are increasingly borne by ordinary companies, as is apparent from various lawsuits, for example. SMEs spend a lot of time and money on contact with the bank. One bookkeeper sighed that he had no time at all other than helping companies fill out bank questionnaires. And then the banks themselves: almost 20% of the people there now work on combating money laundering.

A paper anti-money laundering circus has been created in which thousands of analysts from banks, accountants and administrators keep each other busy. And what does it yield? That is unclear at best. It is time for a better balance in the money laundering approach and a more targeted search by banks for black money. This is not only a role for the banks themselves, but also for supervisors and politicians.

Opinion FD

 

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