TELECOM Digest OnLine - Sorted: Your Money Under More Scrutiny

Your Money Under More Scrutiny

Monty Solomon (
Fri, 29 Apr 2005 01:21:28 -0400

By Manu Joseph

Pressured by anti-terror laws, banks will be spending billions of
dollars over the next few years on software to counter money
laundering. The software will automatically track suspicious
financial transactions, but it will also monitor millions of
innocuous ones, and may make it harder to cheat on your taxes.

Thanks to the stringent requirements of the Patriot Act, enacted
after 9/11 to choke the supply of terror funds, and the unambiguous
threats of steep fines and even imprisonment of bank directors if
their organizations facilitate money laundering, U.S. financial
institutions are very enthusiastic about installing
anti-money-laundering software.

Between 2005 and 2008, American banks are forecast to spend about
$14.7 billion on anti-money-laundering software, hardware,
maintenance and other compliance-related activities, according to
Neil Katkov, a Tokyo-based analyst with Celent Communications. Europe
and Asia are expected to spend over $11.6 billion during that period.

By 2006, 94 percent of large financial institutions in the United
States will have installed anti-money-laundering, or AML,
technologies, according to Celent.

Already, the United States is the global driver of anti-laundering
software. And the number of transactions reported to government
agencies, like the United States' Financial Crimes Enforcement
Network, is growing fast. In 2004, banks reported 14.8 million
transactions to FinCEN. That's 600,000 reports more than in 2003,
according to FinCEN's annual report for 2004 (.pdf).,1848,67249,00.html

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