Case Study Details
Company name: Al Ansari Exchange
Headquarters: Dubai, United Arab Emirates
Sector: Financial Services
Number of employees: 2500
Annual gross revenue: UAED 440.77 million (USD 120 million) 2017
Status: Private
Name of company executive interviewed: prefer to stay anonymous
Position: Business Development Manager
E-mail: [email protected]
Phone number: 600-54-6000 (Call Center)
Date of interview: 1 December 2017
Company Description
Al Ansari Exchange is an exchange company that offers its services in the UAE and is characterized as one of the most successful branch networks. It was officially established in 1996. Still, a general trading business was dated approximately 60 years ago with its leaders’ intentions to meet the remittance needs of various trading partners and customers (Al Ansari Exchange, 2017c). At that period of time, there was no formal banking system in the country, and new services and changes were required. Al Ansari Exchange has become one of the country’s leading exchange organizations. At this moment, there are approximately 170 branches in the company’s network that are located in Abu Dhabi, Sharjah, Fujairah, and other Emirates. Over 2500 employees cooperate with millions of customers and offer fast and credible services. Its total assets are approximately UAED 440.77 million (USD 120 million). A high priority of the company is given to local communities promoting the concept of social responsibility and participating in numerous charity activities to support the population and improve everyday life (Al Ansari Exchange, 2017b). In the business sector, the company aims at providing customers with the best currency exchange services and money remittance opportunities. It is expected to enhance customer and employee experience through ungraded technologies and training. This case study aims at explaining the benefits of Anti-Money Laundering (AML) practices and policies to fight against the financing of terrorism and prevent money laundering.
Description of the Integrity-Related Practice
Many companies are ready to implement AML practices that include different procedures and regulations with the help of which it is possible to control illegal actions and prevent terrorism in the field of finance. The AML practice in the UAE is based on a number of domestic laws. Criminal enforcement is supported and controlled by criminal courts. Money may be illegally derived from different activities, including narcotics, kidnapping, bribery, fraud, and ammunition. Al Ansari Exchange’s employees have to be ready to check every transaction and report on every suspicious case. An AML compliance program was written specifically for Al Ansari Exchange to ensure proper record keeping and reporting on transactions that seem to be strange or unsafe. The approaches are rather clear. First, it is expected to prevent ML. Then, this program helps to avoid penalties and court trials. Another benefit is the promotion of safe currency exchange practices. Finally, customer loyalty and stakeholder engagement can be observed. This compliance program includes a transaction monitoring system, and employees are able to recognize threats and take actions to protect the company and the community. Customer activities are usually automatically monitored, and those activities that do not meet all the requirements are sent to a manager for further investigations.
The main drivers for applying this practice include the necessity to deal with numerous cybercrimes that are popular nowadays, the promotion of safe exchange transactions, and the obligation to find out suspicious people or organizations and protect society against unnecessary and dangerous activities. Al Ansari Exchange is an example of how money transactions should be organized. The company and its employees believe that trust, innovation, and teamwork play an important role in organizational success.
Policy Development
Money laundering (ML) is a well-known global challenge, and the UAE government takes numerous steps to criminalize such activities and protect the population and the UAE business. Al Ansari Exchange cooperates with several local (the Central Bank of the UAE) and international (the Organization of American States) organizations to develop effective activities and be prepared for fights against terrorist funding activities. Al Ansari Exchange continues implementing numerous AML practices through all branches and adhering to the local regulations and laws. In the UAE, the Central Bank developed AML Regulations with 14 recommendations on how to combat ML and terrorist financing (TF). These recommendations are based on the principles supported by the Financial Action Task Force (FATF). Al Ansari Exchange also follows the UAE Federal Law #4 (2002), #5 (2012), and #7 (2014) in terms of which the importance to combat ML, cybercrimes, and TF is discussed. ML is defined as a criminal offense, and Al Ansari Exchange follows a clear approach to control all possible ML activities and introduce an effective integrity-related practice.
An Internal Audit Group is responsible for monitoring and testing the Compliance Program. A detailed description of the policy may be observed on the official site of the company. There are several important issues that the Al Ansari Exchange staff should follow when they have to work with customers and investigate their transactions (Al Ansari Exchange, 2017a):
- Ascertainment of customer identity is required in case a transaction is more than AED 2000, or if a transaction has to be verified for suspiciousness.
- Ultimate beneficial ownership of funds has to be established before customers send their requests so that employees can have all identification details and be able to freeze transactions in case some concerns take place.
- Enhance due diligence is an initiative in terms of which the company may ask for additional information and identification documents from customers.
- The development of record-keeping technologies is appreciated in Al Ansari Exchange because it is necessary to keep the information about every customer during the next five years and have quick access to any transaction history.
- Confidentiality is key to AML practice. Customers are unaware of the reports sent to the UAE Central Bank or other international organizations.
Process for Embedding the Practice within the Organization
Staff training plays a crucial role in organizational management and embedding AML practice. All potential employees have to be provided with a two-month training course before they can be hired. Current employees should be trained and examined every two years to make sure that they know how to work with customers, what technologies can be used to detect suspicious activities, and how to report on strange cases to the Central Bank or other facilities. Several training programs are used by the HR and Compliance Departments. Employees have to visit special meetings and participate in group discussions. In the interview with a Business Development Manager of the company, the training programs are described as interesting and informative talks with an expert who learns how to combine Internet research, technological progress, and personal skills.
The key challenge of an embedding process is based on the necessity to gather many people at the same time. Some employees are not able to combine their working duties and a learning process. More time is required for learning, reading, and practicing. The company is not always able to meet the needs of all participants. Therefore, this practice has to be extended through the supply chain, including approval of the Al Ansari Exchange’s leaders to spend working time on training, control of the participants by a specially trained educator, and evaluation of the work done by a representative of the Central Bank of the UAE.
Another crucial challenge that may be observed in the AML practice is based on the results of the interview. An interviewee admits that some people are not properly motivated in the company. There are many strong personalities who believe that their education is an integral step in their career. However, there are also people who have to be supported and pushed. The company tries to assist the employees who are not confident in their skills. It is evident that it is better to hire people who are aware of personal strengths and know how to use opportunities in the workplace.
Identification and Reporting of Issues
At Al Ansari Exchange, several mechanisms are used to ensure that all AML regulations and practices are followed, and all requirements are met. Employees have to understand that ML is a complex issue. It may not be properly identified, and it is necessary to know how to report on it, not to offend customers, and provide the Audit group with the necessary information. Every employee has to follow certain identification and reporting issues to make sure that the AML policy works effectively:
- The consideration of the system report is required. An employee has to pay attention to a certain transaction and gather all necessary details, including the personal data of a customer, the nature of a transaction, its goal, and the frequency of transactions made by the same customer. In other words, an employee should have enough information to take the next step.
- A report to the head of the Compliance Department is developed. The description of all monitoring systems and the explanation of why a case is suspicious have to be introduced.
- The head of the department should address the HR Department and check the reliability of the employee who reports on the case before making further decisions.
- A discussion of a case is organized, and a representative of the Central Bank has to be present.
- A final decision whether to approve or disprove a transaction is made.
Almost similar steps are taken to introduce a monthly report on ML and TF to ahead of the department and an annual report to a leader of Al Ansari Exchange. The main aspects that have to be covered are:
- A general condition of the AML system in the company;
- A number of ML cases that have been officially reported;
- A number of approved and rejected transactions with explanations (if necessary);
- Recent changes in the work of the system (if any);
- Urgent HR concerns, problems, and achievements that may influence the quality of services offered to customers and provided to stakeholders.
Help desks are implemented in the department where AML procedures are developed. These desks help to contain all important information about the leaders to whom it is necessary to address in case of emergency and memorize the steps employees have to take in their work. Hotlines with the Central Bank are also necessary as a mechanism for reporting the cases. There is one line that is used for the connection with the bank representative and discussion of customers, their financial histories, and possible concerns.
These mechanisms were selected because of two main reasons. First, it did not cost a lot for the company to support this form of communication and exchange of information. Employees are ready to share their knowledge and report as soon as an unclear situation is defined by the system. Regular training programs promote enough knowledge and experience to succeed in this operation. Second, teamwork and trust are the key aspects of the work at Al Ansari Exchange. Employees have to understand each other’s worth and importance in the company. They should not rely on technologies only. They have to know how to use and develop personal skills and think about their future careers.
As a rule, the representative of the Central Bank of the UAE is a final instance that has to investigate the outcomes of the report and understand what should be done with the information given. The company is responsible for storing the information about each transaction, and the Central Bank gathers information about suspicious customers to share it with other organizations that are involved in similar activities. Such an exchange of information can detect suspicious people or organizations and take the precautionary steps on time.
Enforcement
The goal of the AML program at Al Ansari Exchange is the protection against money laundering and compliance with the laws and regulations. It is necessary to remember about this goal to enforce the programs successfully regarding the available resources, opportunities, and stakeholders. Employees have to realize that not all customers and transactions may present the same level of risk, make similar mistakes, or achieve the same goals. Therefore, the company has to be ready to recognize different factors of transactions and cooperate with different people despite their culture, age, gender, and occupation. The peculiar feature of the AML program at Al Ansari Exchange is the necessity to enforce it from several perspectives, including legal, technical, HR, and personal.
To promote legal enforcement of the practice, the company uses the Federal Law and the FATF regulations in terms of which the situations when ML occurs are described, and the results of AML practices are explained. As a rule, the head of the department identifies one person who is responsible for promoting awareness of the law through all managers who have to work directly with customers and evaluate the results of the automatic systems where transitions are recorded.
At Al Ansari Exchange, several people take responsibility for the enforcement of the AML practice at the operational level. There is an IT representative who checks the appropriateness of software and responds to the technological concerns ordinary managers and other employees may have. An HR manager has to work with all employees to check their readiness to work under unexpected conditions, stay calm and confident in the face of evident danger, and demonstrate an appropriate attitude to every customer.
Finally, the ALM practice can lead to positive results in case all employees understand why they need it and what outcomes they may observe. Al Ansari Exchange is a company that deals with millions of financial operations every month. It is hard for many people to demonstrate personal attitudes and opinions when it is necessary to work hard, fast, and effectively. During the interview, the manager compares several employees with robots with no emotions demonstrated. Because of the necessity to work long hours, pass through training programs, and cooperate with different clients, it is hard for some employees (especially for beginners) to combine duties and develop adequate human relationships.
To solve current problems and shortages of the work, Al Ansari Exchange cooperates with an Internal Audit Group that is responsible for monitoring and controlling the activities of employees. Though it is an internal department, it has no other responsibilities and duties except focusing on the AML compliance program. There are 5 or 6 people who work in this group. They divide their roles in a proper way to make sure they can monitor the system, assist employees, and report to the leaders of the department and the Central Bank. At the end of every year, this group introduces the report in terms of which all cases that have happened during the year are described and explained along with the measurements taken and the solutions offered.
Lessons Learned
In this case study, a good opportunity to learn more about organizational management, information technologies, and human resources is given. It is not enough to know that modern information technologies facilitate the work of the staff and save time. It is necessary to understand that working with people may have different characteristics, and employees at Al Ansari Exchange should use various techniques and approaches to please customers and promote safety. As a result of the implementation of the AML policies in the company, its employees become more confident and properly monitored in terms of safety concepts and the quality of work offered to customers. Therefore, the company should share its experience and achievements with other regional companies and become a good example at the international level.
Lesson One: Implementation and Variety
The process of the implementation of the AML practices at Al Ansari Exchange requires the cooperation of different people from different departments. Employees have to be ready for a variety of options and obligations that cannot be neglected. It is important to consider multiple factors within one company and make sure that the staff is aware of how to react to different situations, use the law, report to the leaders, and promote high-quality client care.
Lesson Two: Training as a Part of Success
Al Ansari Exchange provides its employees with effective training courses to develop their skills and improve their knowledge. This case study shows how several hours of learning may promote the months or even years of success. The company supports its staff and gives enough knowledge.
Lesson Three: Continuous Activities in the Workplace
This company shows how teamwork may determine customer loyalty and recognition. Al Ansari Exchange is not only a list of services available to people. It is a team of skilled employees who know how to choose correct activities, monitor and supervise the policy in a proper way.
References
Al Ansari Exchange. (2017a). AML policy. Web.
Al Ansari Exchange. (2017b). Corporate social responsibility. Web.
Al Ansari Exchange. (2017c). History. Web.