Analyzing the Risk of Legalization of Proceeds of Crime through Ukrainian Banks

Abstract

The article is aimed at improving the instrumentarium of risk analysis associated with the use of banks’ services in order to legalize the proceeds of crime. The main directions of scientific research on analysis of the risks of money laundering through banking institutions and ways to counter such risks are analyzed. The carried out analysis showed that most of the proposed approaches are aimed at analyzing the risk of money laundering at the macro-economic level, including the analysis of the number of reports about suspicious operations, where the content of the financial operations as such is not always taken into account. The article suggests to use the analysis of the indicators of both debiting and cash withdrawal in Ukrainian banks as an additional instrument for analyzing the risk of legalization of criminal proceeds. The choice of such an instrument is based upon the fact that, first, cash transactions have the highest risk of legalization of income, and therefore require an in-depth analysis, and secondly, information from banks and other primary entities, engaged in the financial monitoring related to the money laundering issues is restricted for external users, so it is not possible to use all risk criteria to analyze transactions. The carried out analysis with use of the proposed instrumentarium allowed to divide the totality of 77 banks operating in Ukraine into four groups in accordance with the values of asymmetry, excess and variation of data distribution indicators. The main features of certain groups of banks in accordance with the distribution of cash turnover are identified and analyzed.

Keywords

• legalization of income
• countering the money laundering
• financial monitoring
• bank
• risk of legalization