Kleptopia, a new book by Tom Burgis was reviewed in the Financial Times of 14 November. The review provides a good summary of the book which uses real stories to show how autocrats have used the financial system to effectively steal money from their clients and move it to accounts primarily in Europe and North America. Whilst covering a variety of stories, as noted by the Financial Times they are ultimately “a similar tale of political and moral corruption, violence, weak regulation and complicity within the international financial system where money is quickly anonymised.”
And then reported the Financial Times on 17 December that Credit Suisse is being charged with money laundering for Bulgarian clients. Although this money laundering was related to crime including cocaine trafficking, it notes again how individuals within large banks work around policies to prevent money laundering. Both Credit Suisse and the individual are claiming innocence so it may well be that nothing wrong was done but only time will tell.
With both of these stories, it was therefore heartening to read about the official launch of an initiative in The Netherlands. Five of the largest Dutch banks have set up Transactie Monitoring Nederland. Under the interim leadership of Jeroen Rijpkema (a former colleague of mine with experience in private banking), TMN is a “collective initiative (to) enable the banks to improve their detection of these complex criminal money flows and networks and thereby help to improve the protection of the financial system.” As noted by TMN, only through seeing a full spectrum of transactions is it possible to identify those that are related to money laundering and criminal activity. Perhaps other large international banks should be considering a similar approach to address the issues raised in Kleptopia.
