Gold trading is one of the most lucrative industries yet infused with fraudulent gaps and potential financial risks. Money laundering laws have recently applied for responsible gold sourcing that will control the increasing rate of money laundering cases. Read through to know more.
Money laundering is a sophisticated yet more common term for financial fraud. Increasing greed has made money laundering a usual thing. Anywhere and everywhere, money laundering cases have been a normal phenomenon. Regardless of how established a business or a field of work is, the risk of money laundering creeps in relentlessly.
Money laundering is becoming a pressing concern amidst the growing economy. The time during the pandemic has been tough for all business sectors. Time has been a huge challenge for most people and has intruded on their finances too.
Today is the time when people think to themselves, is there any field left where financial risks are limited?
Gold has been a profitable commodity since ancient times. Not just something to own, but to trade. We already know how gold money laundering is a huge threat to the economy today. Let us see why gold is used for money laundering.
It has been noticed that Money laundering cases have shown a sharp rise in the field of gold.
Let us understand how money laundering laws spread around to safeguard the area.
Here are the new policies for responsible sourcing of gold that will give you a broader idea of what measures are being taken.
Recently, MOE (Ministry of Economy) has published laws and regulations to carry out the responsible sourcing of gold. The money laundering law have definitely spread across to implement a stronger and more effective anti-money laundering system.
The whole idea behind widening the scope of anti-money laundering laws is to combat financing terrorism and reduce money laundering cases. The DPMS (Dealers in Precious Metals & Precious Stones sector) sector’s risk rating is inherently "high" and the Refinery sub segment is identified as the sub segment with the highest risk.The latest policies involve controls and measures for the precious metal dealers (including gold). These laws were developed and issued through practical implementation with due diligence guidelines. The OECD or Organization for Economic Cooperation and Development has issued some due diligence guidelines that are counted amongst the best global practices.
The policies are developed with the motive of obliging the gold refiners to stay in line and consider the coming risks of a financial breach. The new policies are as follows-
The Ministry claimed that the companies and accredited establishments should follow the policies from 1st January 2023. The policies were issued last July,2022 that cleared the air.
The money laundering cases in gold sourcing were spiraling to an extent where they needed a stronghold.
Many companies like Smart Infotech have developed AML software that can contribute to controlling money laundering cases. Right from screening the transactions to identifying the pulsating risks, the software works to prune the unusual activities. The software recognizes the risk parties and helps alert the authorities. This way, businesses, companies, and financial institutions stay aware of where the risk lies.