A brand new ‘supply of funds’ resolution has been launched to assist regulated corporations determine soiled cash in only one minute.
Digital compliance supplier SmartSearch has unveiled the brand new expertise, which makes use of open banking to run checks for supply of funds, proof of funds, supply of wealth and supply of revenue, both as a part of a wider search or as a standalone test.
The test is accomplished in simply 60 seconds, whereas the flexibility to evaluate financial institution transactions stays stay for 90 days.
Regulated corporations – together with peer-to-peer lending platforms – are suggested to confirm the supply of funds when finishing up monetary transactions. Nevertheless, money-laundering criminals usually exploit this course of to hid e soiled cash, SmartSearch mentioned.
Learn extra: AI only solution to deal with cash laundering
The proceeds of Crime Act requires corporations to submit a Suspicious Exercise Report (SAR) to the Nationwide Crime Company (NCA) in the event that they consider that somebody is making an attempt to scrub soiled cash earned from the proceeds of crime.
The variety of SARs submitted has doubled within the final 5 years and the NCA has estimated that it’s going to hit 1,000,000 for the primary time this yr, in keeping with information cited by SmartSearch.
Learn extra: Regulated corporations see rise in suspected cash laundering
“Supply of funds checks are an issue space for regulated corporations as a result of the authorized framework round them continues to be poorly understood,” mentioned SmartSearch managing director Martin Cheek.
“For instance, it’s usually incorrectly assumed that funds transferred from a financial institution needs to be classed by default as clear cash. That’s not the case.
“Some additionally wrongly consider that they don’t must test a buyer’s supply of funds after their id has been verified when, in truth, they do.
“These additional checks add to the rising weight of compliance that many regulated corporations are buckling beneath.”
Learn extra: How does the P2P sector defend its clients from fraud?