Answer:
Answer by John Burnett: Let's start with the obvious question. There is no absolute requirement in the regulations that you aggregate at all unless you have the capability.
That said, it's evident that aggregation is expected as part of a BSA/AML program. At a minimum, regulators expect to see aggregation by account and/or by customer. Aggregation by "conductor" is obviously more difficult, and nearly impossible in many organizations. I'm not aware that the "best practices" bar has been raised that far by regulators, either.
There remains a clear requirement to combine simultaneous cash transactions or those the bank knows to be made by the same "conductor." In some environments the ability to record and aggregate by conductor over a business day would prove helpful (meaningful) in an AML program. In others, I'm skeptical about its value.
Answer:
Answer by Richard Insley: The post-mortem perspective is also very helpful. What's all the information going to look like to a law enforcement officer or a judge if the customer is under investigation or being prosecuted for crimes involving the money? Looking back at the evidence, your effectiveness will be obvious. Should you have seen what was happening? Did you see it? Did you choose to ignore information that was readily available for analysis, or did you take the extra steps? If other banks are spending money to "see" what you missed, why did you choose not to meet the commercial standard? This "ghost of Christmas past" perspective will reveal how much attonement you should consider now.
First published on BankersOnline.com 2/7/05
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