Money laundering can cause which consequences for a financial institution? (Select Two.)

The correct answer is B. Increases in investigation costs and fines D. Reduction or loss of profitable business. Money laundering can have serious consequences for financial institutions. They may face increased investigation costs and fines from regulators and law enforcement agencies for failing to detect or prevent money laundering activities. Additionally, money laundering can result…

Risks and Methods of Money Laundering and Terrorist Financing

Question

Options

AIncreases in corporate taxes
BIncreases in investigation costs and fines
CReduction in number of employees
DReduction or loss of profitable business
EIncreases in correspondent banking facilities

How the community answered

(37 responses)

A
5% (2)
B
78% (29)
C
14% (5)
E
3% (1)

Explanation

Money laundering can have serious consequences for financial institutions. They may face increased investigation costs and fines from regulators and law enforcement agencies for failing to detect or prevent money laundering activities. Additionally, money laundering can result in a loss of profitable business as customers and counterparties may no longer want to do business with the institution due to its reputation for being associated with illicit activity.

Topics

#institutional risk#reputational risk#financial penalties#investigation costs

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