The Ways to Minimize the Risks of Legalization of the Bank’s Customers’ Incomes

• Main Authors: Omelchenko Oksana I., Ostrovskyi Denys M.
• Format: Article
• Language: English
• Published: Research Centre of Industrial Problems of Development of NAS of Ukraine 2019-06-01
• Series: Bìznes Inform
• Subjects: banking system; monitoring; minimization of risks; legalization of illegal income
• Online Access: http://www.business-inform.net/export_pdf/business-inform-2019-6_0-pages-239_245.pdf
• ISSN: 2222-4459; 2311-116X

The article is aimed at studying a system of risks management, particularly considering the risks that arise at the present stage in connection with the spread of processes of legalization of criminal funds by means of the banking system, and formulating recommendations as to minimizing them. The works of foreign and domestic scholars on the emergence and spread of various forms and methods of money laundering are analyzed; four main models for the legalization of proceeds of crime are identified; the stages of the process of laundering criminal proceeds are allocated. The most risky transactions for banks in the service of individuals and legal entities are also classified. Particular attention is paid to the instrumentarium to counter the legalization of criminal proceeds and the financing of terrorism. Thus, laws and by-laws in the sphere of countering the legalization of criminal means, directions of cooperation with law enforcement agencies and special international organizations, in particular, the FATF organizational and legal measures, and internal provisions of banks are analyzed. Using the evaluation-analytical procedure of finding the most acceptable option with the hierarchies analysis method, a comparison of risk management strategies according to their impact on the banking sector is made, allocating the most priority instruments.