Anti Money Laundering Compliance for Private Funds


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Essay #: 067567
Total text length is 24,002 characters (approximately 16.6 pages).

Excerpts from the Paper

The beginning:
Anti Money Laundering Compliance for Private Funds
Money laundering is a hot button issue for both government regulators and financial institutions, which run the risk of being subjected to substantial penalties for violation of federal laws and regulations. While traditional institutions like banks and stock brokerages are subject to clear-cut financial regulations, private funds and hedge funds generally receive less guidance. A set of proposed rules that would require private funds, including unregistered funds, to implement anti money laundering programs was on the books for a number of years (since 2002), before dying a silent death near the end of the last decade. Nevertheless, sufficient impetus exists in the form of investor...
The end: be jurisdictional, product-related, service-related, or client-related. However, regardless of where those risks arise, financial institutions designated by Treasury should take reasonable steps to mitigate those risks.
Thus even though private equity and hedge funds, and their managers, are not legally required to implement formal AML programs, market pressures and legal considerations that may not be direct AML regulations, such as criminal laws and Office of Foreign Asset Control Regulations, dictate that private funds implement AML policies and procedures. The use of outside consultants and computer software can simplify the process of instituting the procedures, and once in place, the procedures will become de rigeur in the company.