What are the key elements of an effective anti-money laundering program in private banking?
Private banking is generally considered to be at higher risk for exposure to money laundering because this business line typically involves the provision of a wide range of personalized banking services to high net worth clients who favor the discretion, sophistication and personalized relationship associated with private banking activities. The elements of an effective anti-money laundering program in private banking are well established, and Federal bank examiners have been reviewing banks anti-money laundering efforts for nearly a decade. For example, in 1997, the Federal Reserve published detailed guidance on anti-money laundering safeguards for private banking operations.20 Among other elements, this guidance urges “senior managements active oversight of private banking activities and the creation of an appropriate corporate culture” to ensure a “sound risk management and control environment.” It recommends that banks develop written anti-money laundering procedures, including “kn
