COMPLIANCE DIRECTORS, NEVER DISCOUNT WHAT YOUR FRONTLINE TEAM MEMBERS BRING YOU

This week's news includes the release of reports which confirm that members of the Israel Defense Forces assigned to monitoring HAMAS reported to their superiors that they believed that the information they had gathered indicated an imminent attack by the terrorist organization, but that elite officers discounted their fact-based conclusions, and the result was that the country was unprepared when the October 7th invasion of Southern Israel occurred. I am reminded of similar warnings ahead of 9/11 that were disregarded by then-President George W. Bush in 2001.

There is a valuable lesson here for senior compliance officers, especially at the Director level; when your subordinates bring you snippets of information that they conclude indicates major money laundering or terrorist financing activity where you work, never disregard either their interpretation of information, or their conclusions, for you do not want to have to explain, years later, why you failed to act in the face of intelligence which even possibly indicated that a money laundering operation was being run right under your very nose.  

What we want to avoid is that dreaded visit, years later, by law enforcement, showing us that they have discovered that a highly successful money laundering operation moved the proceeds of crime right through your bank, without being discovered and interdicted, and which was only discovered in the aftermath of a major indictment, when a defendant rendering Substantial Assistance to them explained their laundering scheme. Don't be that person, listen closely to what your young, but effective, subordinates show you.