How to fight money laundering in your enterprise company

people talking about money laundering

Last modified on January 26th, 2023

Thanks to old Hollywood stereotypes, money laundering could be the most famous example of financial crime. But these days, criminals don’t have to ‘clean’ their fraudulent money through a launderette to make it look legitimate. Money laundering cases have risen over the last decade, costing companies more than $800 billion per year.  

Despite this growing number, treasurers, CFOs, and accounting managers don’t seem to be too worried about fraud, with only 28% of finance staff reporting that they are ‘very concerned’ about it. But in the face of fresh warnings about fraud from the SEC, it’s exactly these finance functions that can help prevent money laundering across their enterprises.  

Because with 16 employees being fined $16.5 million in relation to anti-money laundering breaches, you know who gets the blame when it all comes to light. 

Do you want to learn more about how to combat money laundering activities in your company? Read on to find out what best practices we recommend to fight against fraud and illegal financial transactions. 

At Trustpair, we work with large companies to prevent fraudulent payments. With us, money laundering won’t be an option anymore. 

We help streamline your operations across multiple jurisdictions and give you the right data to make informed decisions. With all the information you’ll need on a simple dashboard, we save your people from processing suspicious transactions that use laundered money.    

Want to get started with Trustpair? Request a demo here.

demo request trustpair b2b payment prevention plateform

What is money laundering and why is it such an issue? 

Money laundering refers to the disguise of funds generated by criminal activity. Fraudsters are able to ‘wash’ the dirty money through a legitimate source to make it seem like the money was generated legally.  Money laundering significantly increased in the last decade, and the cost of compliance has also risen. Large companies filed more than double the number of suspicious activity reports in 2018 compared to 2007

Despite this growth, 41% of financial institutions are still inadequate at meeting anti money laundering compliance requirements. With the likes of the US Patriot Act, Bank Secrecy Act and other anti-money laundering law, is it any wonder that enterprises are struggling to keep up with the regulators? 

There are many different ways fraudsters can launder the proceeds of their crime, which makes it hard to cover all bases. Profits from illegal arms dealing, smuggling, drug trafficking or even terrorism might all have their origins disguised to look like the cash was generated through legal means. 

However, laundering in a corporate fraud setting is a much more specific case. For example, criminals could commit embezzlement, insider trading, bribery, or invoice fraud. 

Let’s say you’re the CEO of a company that sells goods (such as clothing). Without the proper controls in place, criminals could target your company and launder money by over-invoicing you when posing as a supplier. This way, you’re paying for goods and services you had never received.

Even with good internal controls in place, corporate money laundering can happen – and it puts your senior leaders at risk. Not only does money laundering put pressure on your people, it also exposes your entire supply chain, customers and vendors. And we all know how much trust and reputation is important in business relationships: having your company involved in money laundering might ruin what you’ve been building for years. 


How does money laundering work at a corporate level?

In most cases, there are three stages: 

  1. Placement
  2. Layering
  3. Integration


The money is ‘cleaned’ through a legal entity by being placed into its financial system. 

Companies that generate more than 100 million of turnover each year are particularly susceptible to placement, as criminals can hide their suspicious transactions in a sea of customer orders. Without monitors for suspicious transaction activities, this can easily fly under-the-radar. If that’s the case of your company, you should definitely be extra-mindful and have the right level of scrutiny.


The money launderer then tries to disguise the source of this new profit to make it appear realistic. This means creating false records, inventive bookkeeping, and the generation of an audit trail. 


The ‘cleaned’ profits from the legit business are reinvested into another source. This moves the money into the wider economy. Once the funds hit a truly legitimate source without criminal links, it’s much harder to discover the money laundering offense. 


What type of money laundering can occur in your company?

There are a few different money laundering examples on a corporate fraud level. Here are some of the most common: 

Tax evasion 

Individuals like a CEO may launder money in order to commit tax evasion. Some companies may send a portion of their income through a separate offshore account or shell company in a form of money laundering. It means that it does not show up on transaction records, and they can try to hide it from the IRS when doing a tax return. If caught though, sanctions can include the likes of imprisonment, fines, and other penalties. 

Electronic money laundering

Most corporations need a license to process transactions virtually (like on Apple Pay or Google Pay).

Even with this license, organizations process fraudulent charges, failing to do proper due diligence. Businesses don’t have the tools to discover whether their customers have links to criminal organizations. This places large corporations at a higher level of money laundering risk and attempted fraud.

Invoice fraud

Invoice fraud is one of the most common examples of money laundering at a corporate level. Criminals can impersonate one of your known suppliers by making their own (fake) invoice look realistic. 

Fraudsters can get away with inflated costs, false descriptions, or phantom shipping. Or, they can intercept a legitimate invoice through an email from a supplier and switch the bank details to their own, in a phishing attempt. 

It can be incredibly difficult for US-based companies to verify the bank accounts of overseas suppliers without investing heavily into their own anti-fraud program. Thankfully, Trustpair’s account validation feature is able to block invoice fraud by using bank data. 

We’re able to identify this information directly to your finance function, and set controls in place. This means your suppliers won’t be able to change their bank details without passing an audit check, preventing the likes of invoice fraud. 

How are cryptocurrencies being used in money laundering

Risk management practices are few and far between in cryptocurrency transactions. Since the blockchain is a new system based around anonymity, freedom and governance, controls seem to go against everything crypto stands for. 

But this means that transactions have a high risk of criminal activity. In fact, cases of money laundering through virtual currencies increased by over 300% between 2018 and 2019, totalling over $2.8 million.  

The problem for accounting managers?

Anyone is able to open a new wallet without proof of identity. This means criminals are able to move their crypto through many different accounts in quick succession. Shifting funds through barely regulated exchanges means they are able to easily conceal their origins. Then, they ‘clean’ the money through a legitimate source. 

And there’s no real way to tell who’s who. 


How can you prevent money laundering and corporate fraud?

Without a focus on anti money laundering practices, senior finance leaders expose their enterprises to security breaches, non-compliance fines and losses in the millions. 

Preventing money laundering should be the top priority for senior leaders in finance. 

Comply with regulations

In the US, we have a really strong anti-money laundering (AML) regulation for regulated financial services companies, overseen by FINRA. AML compliance can look like this: 

  • Building a program to detect and report suspicious activity successfully
  • Creating a risk-based customer identification system
  • Having a qualified designated AML compliance officer

Build a robust due diligence process

Good due diligence is at the heart of anti-money laundering. This means going beyond the standard background checks that you should be doing on your suppliers and customers and enforcing tighter supervision. Working with a platform like Trustpair gives finance execs confidence in their due diligence, since the intelligent vendor data management system covers all the relevant authentication details that manual research might miss.  

Plus, by opting for secure payment methods like secure wire transfers, you can ensure that your money only goes to the verified account holder. This lowers the risk of interception and supplier impersonation. 

Back up your security system with software

Upgrade your security so that none of the data you collect can be compromised by criminals or even terrorist. One of the best ways to do this is through specific anti-fraud software, like Trustpair

One of the best anti-fraud software features is compliant third-party account validation. This means that, while still complying with global regulations, you can manage third-party risks through the most in-depth background checking. At Trustpair, this works by streamlining several external and internal databases to eliminate the risk associated when working with a new supplier. 

Using this feature on potential partners means that you can be confident in your risk assessment. Plus, you’ll reveal any suspicious relationships involving people you intend to do business with.  

The importance of combating money laundering

Here’s the thing about money laundering: funds are only recovered 0.1% of the time for US-based companies. It means that active prevention – even in the case of the smallest suspicion –  is key because if you fall victim ton money laundering, you’re unlikely to get your money back.     

To give your firm best-in-class support against corporate fraud, choose Trustpair. By removing the risk of fraud, our clients have retained over $60 million and benefit from better relationships with their suppliers with a sleek payments process.

Smooth as butter. 


Prevent money laundering fraud with Trustpair’s financial intelligence platform. 

demo request trustpair b2b payment prevention plateform


If concealed well, it can be really hard to find a paper trail for money laundering. The biggest thing to look for is a clean audit trail for past payments and the verification of goods received. 

KYC refers to Know Your Customer. This is a regulatory requirement for some financial institutions, referring to the background checks that companies must do on customers. 


The overall goal of KYC fits with the general anti-money laundering definition: it aims to verify the identity of customers and reveal their connections to other suspicious sources.

Manage the risks related to corporate treasury.

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