are key to zero-tolerance in this battle against corruption . Using such cases might deter future perpetrators from committing similar crimes .
Drilling down the beneficial ownership fight — Anti-Money Laundering Act of 2020 ( AMLA )
One of the major regulations introduced by the Financial Crimes Enforcement Network ( FinCEN ) within the last few years was the AMLA . 15 This act is one of the most recent reforms by the U . S . that identified the gap within our system . Prior to the AMLA , it was only a requirement by FIs to identify , collect , report and verify the true beneficial owners of companies that do business with those FIs . Since the implementation of the AMLA , companies that incorporate under various names are required to disclose their true beneficial owners . This is an important step toward identifying individuals who camouflage and divert their corrupted and other ill-gotten funds behind front companies . FinCEN now has the authority to request the actual beneficial owners of these businesses and share that information with appropriate authorities . The AMLA would eventually provide the transparency that would enable the successful uncovering of the ultimate beneficial ownership challenge and unmask many individuals who have and are planning to create masked entities to cover their ill-gotten funds , such as bribes and other laundered money .
Proactive measures in combating corruption
Corruption can dismantle organizations , which can eventually bring down a nation ’ s economy . Thus , no country is immune from corruption . That is , despite a country having the most stringent AML rules and regulations and the most effective LE , there is always an individual or a group of individuals who do not possess strong moral and ethical values . However , legal scholars have introduced proactive tactics in combating corruption .
One method that the U . S . has utilized effectively and is starting to increase usage of is the Whistleblower Protection Act ( WPA ). 16 As the name indicates , the WPA protects individuals who report suspected behavior . Many organizations have an anonymous hotline number or a mailbox that accepts reports of suspected behavior or corrupt acts by colleagues within that organization . These are investigated by an independent party with utmost confidentiality and results are referred to LE depending on their severity . In recent years , recognition of the WPA ’ s potential importance has grown within public and private organizations . A sound ethical code has been recognized as a way to prevent corruption and protect public and private funds , leading toward a positive growth trajectory .
Another method that works in parallel with the WPA is utilizing accountants as gatekeepers in performing audits and identifying inconsistencies in financial statements . Since the inception of accounting as a profession , an accountant ’ s main role has been to be transparent , provide integrity in financial statement reporting and provide assurance of the fairness of the financial statements to the public . As such , accountants should be regarded as the first line of defense in providing guardrails against possible corruption .
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