20170926: My newsletter - Improving Suspicious Activity Reporting - HKG, SYD, MEL, (CGK)JKT, DXB, LON

20170926: My newsletter - Improving Suspicious Activity Reporting - HKG, SYD, MEL, (CGK)JKT, DXB, LON

Nigel Morris-Cotterill

You know the old joke - you know when you are travelling too much when you refer to cities by their airport codes?

Well, yes, that's exactly what I'm reduced to. Having just got home to Kuala Lumpur after KUL, CAN, HRB and return (delayed a day because the otherwise excellent China Southern cancelled one of my flights and gave me a key-ring to make up for it), I'm now setting up the schedules for the final (so far as I know) legs of my seminar tour.

At the beginning of the year, it was called "Understanding Suspicion in Financial Crime" and feedback told us that that sounded too academic, too far removed from the daily grind. Of course, nothing could be further from the truth: it's a look at the fundamentals of why suspicion based reporting fails.

Anyway, for the rest of its run, the seminar has been renamed: "Improving Suspicious Activity Reporting." I could have called it "Why your staff don't make reports when they should" or "Why your staff are trying to put you in jail for compliance and risk failures." Too blunt? I think so, although that's exactly what the course is about.

The course is based on my book "Understanding Suspicion in Financial Crime" for which the publicity says "320,000 words, none of them wasted." It contains more than 20 years of experience and research into why financial crime risk management systems fail to produce the SARS that they should.

In the course, we look at the issues raised in the book and examine case studies drawn from all over the world. There are common factors in almost all the cases which have cost, in come examples, fines and penalties of hundreds of millions of USD, cost people jobs, in some cases freedom and has resulted in widespread adverse publicity for banks when the problems were localised.

We will look at de-risking and whether the processes for that are based in reality or are so superficial that they border on the discriminatory - and see why that superficial approach is obvious but flawed.

This seminar will help reporting entities improve their recognition of suspicious activity and internal and external reporting.

It will also help investigators, regulators, prosecutors and judges understand why suspicious activity is under-reported and to identify weak areas in internal systems in reporting entities.

An interactive event for

- financial crime risk officers, including MLROs, in banks, insurance companies, securities houses and all other businesses subject to laws requiring financial crime, including money laundering and terrorist financing, risk management.

- investigators and prosecutors - why do individuals and companies fail to make reports?

- defence lawyers - where are the boundaries of reasonable cause for suspicion?

- regulators - why do information flows within companies fail?

- judges - explaining to jurors issues of wilful blindness and reasonable cause for suspicion.

Regulators will benefit from learning how the entities they supervise are better able to design and implement systems for risk-assessed systems having specific regard to how individuals within organisation define, identify and react to suspicion.

Financial sector and other regulated businesses will learn techniques for the development of a financial crime risk reduction and management strategy by understanding why members of staff do, and do not, identify suspicious activity.

Prosecutors and judges will learn how to explain, to a lay jury, the complex matters that lie behind failures to identify and report suspicions.

Despite the shift in language emanating from e.g, the FATF and regulators, there has not been a corresponding shift from compliance to risk management at legislative, regulatory or operational levels. In fact, compliance has become almost completely dominant.

Failures in compliance systems are punished but failures in risk management are little understood.

I will encourage round-table discussions which, I hope, will engage all the target audiences.

Starting in Hong Kong in September, then Australia (Sydney and Melbourne) in October, onto Jakarta in November and Dubai and London in December.

Seats at each event are limited so please don't delay. There are no marketing gimmicks such as discounts for multiple seats or early bird. While some of our competitors are charging as much as GBP1,700 for a two day event, our policy at The Financial Crime Forum has always been to provide the best value we can, hence a fee of only GBP500 for two days, plus UK VAT where applicable.

To book, please see www.financialcrimeforum.com.

*Are you a regulator or a professional body? *

The tour has sufficient spaces for those who would like to run it in-house or for regulators and/or professional bodies to organise it. Please see www.countermoneylaundering.com.


We've received a novel spam-scam that our providers say they have never seen before. We've published it at www.chiefofficers.net so your IT people can identify factors and screen incoming mail, so preventing it reaching your staff. It's particularly insidious and it seems as if someone may be piggybacking on the e-mail that, allegedly, led to the data breach at accountants and advisers Deloitte.


If you are a genuine subject matter expert in matters relating to financial services, financial crime risk management, corporate management, taxation, and a wide range of other subjects, PleaseBeInformed.com welcomes contributions that add to the sum of human knowledge. Take a look and see what you think. We are anxious to expand the range of expertise available within the platform.


Talking of airlines - keep an eye out for the case study of how Lufthansa has promised compensation to passengers and then simply not paid. We've also got in hand stories of how WePay, AliPay and Xianyu (second hand market under Taobao) have failed to deal with frauds exploiting their systems and how a famous New York watch dealer with rafts of accreditations and carefully built credibility sells expensive watches made up of spare parts, delivers inexpensive watches that are not the advertised (and purchased) expensive watches and hugely under-invoices for exported watches in what may be a large-scale tax fraud.

I look forward to seeing many of you during the tour.

Best wishes

Nigel Morris-Cotterill