+更多
专家名录
唐朱昌
唐朱昌
教授,博士生导师。复旦大学中国反洗钱研究中心首任主任,复旦大学俄...
严立新
严立新
复旦大学国际金融学院教授,中国反洗钱研究中心执行主任,陆家嘴金...
陈浩然
陈浩然
复旦大学法学院教授、博士生导师;复旦大学国际刑法研究中心主任。...
何 萍
何 萍
华东政法大学刑法学教授,复旦大学中国反洗钱研究中心特聘研究员,荷...
李小杰
李小杰
安永金融服务风险管理、咨询总监,曾任蚂蚁金服反洗钱总监,复旦大学...
周锦贤
周锦贤
周锦贤先生,香港人,广州暨南大学法律学士,复旦大学中国反洗钱研究中...
童文俊
童文俊
高级经济师,复旦大学金融学博士,复旦大学经济学博士后。现供职于中...
汤 俊
汤 俊
武汉中南财经政法大学信息安全学院教授。长期专注于反洗钱/反恐...
李 刚
李 刚
生辰:1977.7.26 籍贯:辽宁抚顺 民族:汉 党派:九三学社 职称:教授 研究...
祝亚雄
祝亚雄
祝亚雄,1974年生,浙江衢州人。浙江师范大学经济与管理学院副教授,博...
顾卿华
顾卿华
复旦大学中国反洗钱研究中心特聘研究员;现任安永管理咨询服务合伙...
张平
张平
工作履历:曾在国家审计署从事审计工作,是国家第一批政府审计师;曾在...
转发
上传时间: 2024-09-29      浏览次数:279次
Money laundering: A growing threat to Bangladesh’s insurance sector

 

https://businesspostbd.com/special-supplement/money-laundering-a-growing-threat-to-bangladeshs-insurance-sector

 

Money laundering is a significant risk in various sectors globally and the insurance sector is no exception. In Bangladesh, the insurance industry is growing, which brings both opportunities and vulnerabilities. Here’s an overview of the emerging money laundering risks and vulnerabilities in the insurance sector of Bangladesh:

 

Emerging Risks: Emerging risks in money laundering within the insurance sector stem from complexities in products, global operations, the anonymity of transactions and regulatory variations. These factors enable criminals to exploit insurance policies for laundering illicit funds through cash payments, shell companies and complex transaction layers. Technological advancements and new insurance products further complicate detection and prevention efforts. Addressing these risks requires robust AML compliance, enhanced due diligence and collaboration across stakeholders to strengthen defences against financial crime. In life insurance companies, major concerning areas are as follows:

 

l  Life Insurance Products: Life insurance policies, especially those with high premiums (single premium with high value) and the ability to cash out by policy surrendering, are attractive to money launderers. They can pay premiums with illicit funds and later withdraw them as clean money.

l  Investment-linked insurance products: These products allow for the investment of funds in various financial instruments, which can be used to launder money by cycling it through the financial system.

l  Annuities: Annuity contracts, which are often large and can be purchased with lump sums, are potential vehicles for laundering large amounts of money over time.

 

Vulnerabilities: Money laundering vulnerabilities in the insurance sector are the result from the complication of insurance products and transactions, high premium payments often accepted in cash, cross-border transactions, the use of shell companies to obscure ownership, fraudulent underwriting and claims processes, reliance on third-party distribution channels, inadequate customer due diligence, management of investment products and regulatory gaps. Addressing these vulnerabilities requires robust anti-money laundering frameworks, enhanced due diligence and effective collaboration between insurers, regulators and law enforcement agencies to prevent the exploitation of the sector for illicit financial activities. We can identify the following reasons for these vulnerabilities in Bangladesh,

 

l  Lack of awareness and training: Many insurance companies and their employees may lack sufficient awareness and training regarding money laundering risks and the necessary compliance measures.

l  Regulatory gaps: Inadequate regulatory frameworks and enforcement mechanisms can leave loopholes that money launderers exploit.

l  Customer due diligence (CDD) and know your customer (KYC): Inconsistent or weak KYC and CDD processes make it easier for money launderers to use insurance products without detection.

l  Complexity of products: The complex nature of some insurance products can make it difficult to monitor and track financial transactions effectively.

l  Use of intermediaries: Insurance brokers and agents can sometimes be used to circumvent anti-money laundering (AML) controls, either knowingly or unknowingly.

l   

Recommendations to mitigate risks: We may take some mitigation initiatives as recommendations against the probable money laundering risks and vulnerabilities in the insurance sector of Bangladesh. These are,

 

l  Enhanced regulatory oversight: Strengthen the regulatory framework and ensure rigorous enforcement of AML laws and regulations within the insurance sector.

l  Improved KYC and CDD processes: Implement robust KYC and CDD processes to verify the identity of customers and understand the nature of their transactions.

l  Regular training and awareness programmes: Conduct regular training sessions for employees and intermediaries to enhance their understanding of AML risks and compliance requirements.

l  Transaction monitoring systems: Deploy advanced transaction monitoring systems to detect suspicious activities and transactions promptly.

l  Collaboration and information sharing: Promote collaboration among insurance companies, regulatory bodies, and law enforcement agencies to share information and best practices in combating money laundering.

l  Risk-based approach: Adopt a risk-based approach to AML compliance, focusing on higher-risk products, services and customers to allocate resources more effectively.

 

The insurance sector in Bangladesh is susceptible to money laundering risks despite regulatory frameworks being in place. Challenges include the potential misuse of insurance policies for illicit funds, gaps in transaction monitoring and customer due diligence and the evolving nature of technological threats. Effective enforcement of regulations, enhanced monitoring capabilities and international collaboration are essential to mitigate these vulnerabilities and safeguard the integrity of the sector.

 

Addressing the emerging money laundering risks in the insurance sector of Bangladesh requires a coordinated effort between the government, regulatory bodies and the insurance industry. By enhancing regulatory frameworks, improving due diligence processes and fostering a culture of compliance, the sector can better safeguard against money laundering activities.