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Transaction Monitoring Netherlands (TMNL): A Unique Approach to Money Laundering

Money laundering is a wrecker for the global economy… The United Nations estimated that laundered money in one year makes up to 5% of global GDP. That's approximately $2 trillion laundered annually. In the Netherlands alone, it is estimated that an astonishing 16 billion euros are laundered every year. This money is connected to drug trade and human trafficking, which is a serious, complex social problem.

Money laundering in the Netherlands

Banks are on the front line in the battle against financial crimes, however, there are limits to what individual banks get to observe. This is because money laundering networks often spread their activities across multiple banks.

This complex, serious problem has led the major banks to face hef ty fines and legal battles with the system. For instance ING paid a record fine of 775 million euros after failing to detect money laundering activities. ABN AMRO, another major Dutch bank, also got in hot water after violating Dutch anti-money laundering rules, But these two banks aren't the only ones targeted by financial criminals, Rabobank was fined €1 million for poor money laundering checks.

But Dutch banks are fed up with this situation, which is why the 5 major Dutch banks have joined their forces under the name “Transaction Monitoring Netherlands”, TMNL for short. 

So what does the TMNL do?

In an effort to forestall criminal activities, the participating banks send their encrypted transaction data to TMNL, who then monitors these transactions to detect unusual activities that potentially indicate money laundering. Once detected, the TMNL sends the transactions to the involved banks. The bank is then responsible to report suspicious activity to the Financial Intelligence Unit to further investigate said transaction. It is worth noting that the TMNL currently only monitors business accounts. 

The Added Value of Collective Transaction Monitoring

Hearing this you might wonder, but the Dutch government monitors transactions for years, so how is the introduction of the TMNL different?

In a nutshell, under the current  law, banks play a crucial role and can make a substantial contribution to limit money laundering. But until recently, banks looked for suspicious transaction patterns individually. And as we mentioned earlier, individual banks have limited visibility into potentially criminal transaction flows, because criminals often spread them across different banks.

Finally, if you ask us, this unique approach to battle money laundering makes a lot of sense in theory. And seeing the biggest banks team up for this initiative is a great step in minimizing money laundering. That being said, we hope to see the TMNL work with even more banks and financial institutions to build a strong defense against criminals.

Do you think that the TMNL initiative will help significantly drop money laundering rates?
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