Source of Funds and Airport Queues

We sometimes get asked questions like, “Why am I being asked to do a Source of Funds? I’m only giving my granddaughter £2,000 to help her buy a house!” and “Why do we need technology for this, can’t I just give you a bank statement?”. We thought an airport-based analogy might help to explain.

Source of Funds explained

To start with, let’s recap what Source of Funds checks are. The UK is a major international financial and legal centre, with a strong reputation for honesty and integrity.  Unfortunately, that makes financial and professional businesses, like banks and solicitors’ firms, attractive to criminals who try to hide dirty money by turning it into legitimate income.  For this reason, the government has introduced compulsory checks, which businesses must perform to understand where their clients got their money and to confirm it isn’t related to any sort of crime. As time goes on, criminals are using increasingly sophisticated methods to conceal the sources of illegal money.

Technology over intrusion

Now consider the security checks we all undergo at the airport before we can get to WH Smith to buy our book for the beach. Prior to the 1970s, airports had minimal security arrangements to prevent acts of terrorism – until in 1972 a trio of hijackers threatened to fly a US aircraft into a nuclear reactor. Shortly after this, the FAA required all airlines to begin screening passengers and their carry-on baggage; these rules were further tightened over time as more sophisticated methods were used to circumvent security.

As security rules were tightened, the use of technology has become increasingly important in increasing the accuracy and speed of the checks. For example, X-ray systems are used to scan luggage to prevent opening each item by hand, and sophisticated full-body scanners are used to remove the need for a burly security guard to check your inside leg measurement.

Defeating dirty money

Armalytix performs the same function for Source of Funds. Instead of requiring clients to provide reams of paper bank statements and fill in 20-page forms explaining their financial situation, it allows them to share their information quickly and easily, whilst also avoiding the need for the businesses to pore through it all; instead allowing them to quickly understand their clients’ financial situation and move along with the transaction.

When we get on a plane, we all know that we aren’t terrorists and we aren’t carrying a knife; similarly when buying a house or giving someone some money we also know that we haven’t laundered any money and we don’t work for a terrorist organisation. Armalytix is all about helping to demonstrate those facts quickly, securely and in a way that’s easy to understand, whilst acting as a security system to stop the flow of dirty money that causes such harm to individuals and society.

By The Armalytix Team — 25 July 23

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