Months of Look Backs Required
By Christine Duhaime, B.A., J.D., Financial Crime and Certified Anti-Money Laundering Specialist
According to this article in Reuters, as a result of non-functioning anti-money laundering software, Standard Chartered Plc will be undertaking the monumental task of reviewing millions of processed transactions to determine if such transactions should have been reported or subjected to enhanced due diligence under anti-money laundering laws but were not.
The exercise, known as “look backs” will take months to complete and will likely cost more money in terms of analysts’ time than the faulty software itself. The review will have to look at suspicious activity, terrorists lists, politically exposed persons, and sanctioned persons and entities. Subsequent to the look back review, however, identified transactions will then have to be reported and addressed.
Apparently, the software glitch may result in a fine of more than $100 million against the bank for anti-money laundering compliance failures.