Anti Money Laundering Regulation - AML FINRA Rules

Firm Element and the coverage of anti money laundering (AML) is an important part of regulatory and firm element FINRA CE.

Money laundering is the process of filtering the proceeds derived from illegitimate criminal activities through one or more legitimate financial transactions. The goal is to place funds from illegitimate activities into the legitimate financial system without attracting attention.

A straightforward example of money laundering involves the drug dealer who receives cash from the sale of controlled substances. The drug dealer deposits the cash in a legitimate bank account. The sales proceeds may be further laundered by investment in a legitimate business enterprise. On the surface, both the cash in the bank account and the cash derived from the business appear perfectly legal. A look behind the scenes reveals that both are tainted due to their source.

Money may be laundered through a variety of transactions. The simplest case involves the deposit of illegitimately obtained funds into a legitimate financial vehicle such as a bank account, cash value life insurance policy, or annuity.

With financial transaction money laundering the prohibited action is conducting or
attempting to conduct a financial transaction, knowing that the money or other property involved represents the proceeds of some form of unlawful activity.

FinCEN is an agency of the Treasury Department. It is charged with oversight and
implementation of the federal anti-money laundering laws. It passes along intelligence to state, federal, and international law enforcement agencies and financial industry regulators to help them in their efforts to combat money laundering.