Banking industry insiders have suggested de-risking does not necessarily stop illicit funds from passing through the financial system, instead labelling the practice a by-product of ineffective regulation.
De-risking, a practice whereby banks sever ties with businesses, organisations and consumers deemed too high risk, has caused serious issues for the cross-border fund transfer industry.
But Jennifer Shasky Calvery, the global head of financial crime threat mitigation at HSBC, said this week that de-risking does not necessarily reduce the likelihood that laundered funds or terrorist finance will enter banks’ systems.
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