FBI Concerned About Money Laundering Risks in Private Equity Transactions

Jul 17, 2020 | Compliance Updates, iComply Insights

Leaked report highlights FBI’s growing attention towards private sector AML risks with advice for corporations to ensure proper due diligence

What Happened?

July 14, 2020: The $10-trillion private equity market in the U.S. is facing additional scrutiny as a vehicle for money laundering, according to the intelligence bulletin reported having been leaked from the FBI.

The document suggests that private investment funds lack adequate anti-money laundering programs and calls on regulators to enhance their screening efforts of the industry.

Source: https://www.reuters.com/article/bc-finreg-fbi-laundering-private-equity/fbi-concerned-over-laundering-risks-in-private-equity-hedge-funds-leaked-document-idUSKCN24F1TP

 

Who Is Impacted?

Private capital markets firms, investment funds, and equity firms, as well as their law firms and due diligence providers.

 

Why This Matters?

As the power and size of private capital markets increased, experts are expecting regulators to pay closer attention to corporate mergers and acquisitions transactions, angel investments, and private equity markets.

 

What’s Next?

While no public action has been taken by regulators, private capital markets continue to operate with little-to-no KYC friction. The leaked FBI document demonstrates the growing trend among law enforcement agencies and financial regulators to set new standards of AML compliance for all verticals of private capital markets.

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