With every news about a scam involving cryptocurrencies or a new scandal of celebrities associated with sports betting companies, the popular Bets, the sensation is that the underworld of crime is many steps ahead of the civilized world in their strategies to transform illegally obtained resources into assets that appear to be legitimate, the so-called money laundering.
After all, faced with the clamor of the business world for innovations that lead to the emergence and spread of mechanisms like cryptocurrencies and the popular demand for the possibility of combining the useful (making money) with the pleasant (trusting in your favorite team) in bets, how to monitor the occurrence of thousands of transactions every minute to prevent all this goodwill from being used to finance criminal activities and terrorism, for example?
In Brazil, Law No. 9,613 of 1998, known as the Anti-Money Laundering Law, is the legal basis that defines the crime and establishes severe penalties for the involved parties. In addition, it created the Financial Activities Control Council (COAF), responsible for receiving reports of suspicious operations and producing financial intelligence to combat this type of crime.
On the other hand, the Central Bank works directly with the Brazilian System for Prevention and Combating Money Laundering and the Financing of Terrorism (PLD/FT). It regulates the norms for financial institutions to implement AML/CFT policies, monitoring and inspecting their compliance and applying administrative sanctions when necessary. Furthermore, the Central Bank maintains the Customers’ Registry of the National Financial System (CCS) and reports suspicious activities to COAF and the Public Prosecutor’s Office.
But in practice, technology is key in preventing money laundering. Advanced data analysis tools allow financial institutions to detect patterns of suspicious activities and identify potential cases. The implementation and integration of specialized software is recommended to improve efficiency in detection and strengthen internal compliance and auditing processes.
One of the fundamental requirements in this regard is for financial institutions to know their customers deeply. This involves conducting a comprehensive identification of all parties involved in financial transactions, both Individuals and Legal Entities. The KYC process is not limited to document collection alone but also includes verifying the source of funds and continuously analyzing transactions to identify suspicious behaviors.
Concerned about the issue, Febraban will hold the 14th edition of the Congress on Money Laundering and Terrorism Financing Prevention in São Paulo on October 15 and 16, considered the largest event on the subject in Brazil. Not by chance, the central theme this year will be “Integrated approach among control areas.”
The program will allow a reflection on sensitive and strategic topics not only for banks but for the whole of society, which ends up, in one way or another, being threatened by this practice.
Some themes already defined include: “Challenges in the interaction of Financial Intelligence Units”, “Strategic actions to combat and prevent illicit activities”, “Use of artificial intelligence in AML/CFT”, “Sports betting and their impacts”, and “Socioenvironmental Crimes – slave labor, money laundering crimes, and corruption”.
As we can see from the breadth of discussions, it becomes completely utopian to imagine that a new law or a new technological solution alone will be able to tackle the challenge.
In this scenario, the sharing of information and integrated technologies is the only way to strengthen the fight against financial crime and mitigate the risks associated with money laundering, ensuring compliance with current regulations.
