5 Money laundering controls

Figure 5 Look into 'money laundering'

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This is an illustration. Four identical figures sit at a blue counter. They are wearing suits and ties, covering their faces with magnifying glasses.

Figure 5 Look into 'money laundering'

There are also some other types of controls over money laundering, such as risk assessment.

Risk assessment goes hand in hand with risk management. Risk assessment is the systematic process of evaluating the potential risks that a business might face, while risk management is about dealing with those risks. It is not enough for organisations merely to assess risks – they must also manage risks to survive and operate successfully (Kassem, 2021).

Firms need to conduct regular assessments to evaluate the risk of money laundering. When conducting a risk assessment, a firm will consider the following factors:

• customers
• location
• products and services
• transactions
• distribution and delivery channels.

Sound risk assessment can help a firm develop effective policies, procedures, controls and approaches to detect and prevent money laundering.