Conference – Banks vent fraud fury

Bankers are furious at police efforts to clamp down on money laundering, claiming they have been shut out of investigations despite supplying thousands of tip-offs about suspicious money transfers.

The banks complained that the National Criminal Intelligence Service, which collects the tip-offs, has refused to inform them about investigations.

This, in turn, has led to ‘a collapse in motivation’ among banks to supply the tip-offs.

The banks’ views echo criticisms expressed behind the scenes by officials at the English ICA. They claimed that a drop in the number of accountants filing reports of suspicious transactions last year was due to widespread scepticism that reports would be followed up by the police.

One official said recently that NCIS lacked the people and resources to tackle money laundering effectively.

Last year, banks based in the UK supplied 14,000 tip-offs, officially known as suspicious transactions reports, compared with 16,000 in 1996.

The NCIS said the drop was due to greater scrutiny of transactions by the banks before they were reported.

But Sue Thornhill, a consultant at the British Bankers’ Association (BBA), told a gathering of fraud experts last week at the International Cambridge Symposium on Economic Crime, that the drop could owe as much to a fall in motivation among banks.

‘We’ve got 11 years of experience, but we have found that the financial sector has been completely demotivated because there is no feedback from the NCIS about cases.’

She said the BBA had spent several years lobbying the Paris-based Financial Action Task Force (FATF) to produce guidelines that would allow banks to liaise with NCIS during investigations.

FATF originally produced rules setting out how its 17 member countries, including the UK, should deal with money laundering. They were made UK law in 1993.

Thornhill said she hoped the recent publication of the guidelines would lead to a better understanding between the NCIS, the police forces that take up investigations and the banks.

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