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Anti-Money Laundering: "Accounting with Pizzazz"

Drug lords, human traffickers, corrupt business and government officials and terrorists beware; USF is preparing students for this growing field in innovative MBA and graduate certificate programs.


Professor Kerry Myers addressing a meeting of the Muma College of Business Dean's Executive Advisory Council.  Photo by Michael Maurer

 
By Barbara Melendez
      USF News

TAMPA, Fla. (Oct. 22, 2015) – The field of accounting, ...fun? Exciting? Absolutely, if you take it from USF Professor Kerry Myers and specialize in anti-money-laundering work. He calls it “accounting with pizzazz.”

Accounting, it turns out, plays a very important role in the fight against illegal drugs, human trafficking, business and government corruption, and terrorism. High-paying jobs await those skilled in this growing segment of the battlefront.

USF’s Lynn Pippenger School of Accountancy in the Muma College of Business is offering the first academic program specializing in money laundering risk management in the nation. The university launched its graduate certificate in Compliance, Risk and Anti-Money Laundering this fall which prepares students to take the exam to become a Certified Anti-Money Laundering Specialist. There is also a concentration on these areas in the MBA program.

Myers, who teaches graduate classes in forensic accounting, found his way to being an expert in anti-money laundering through a somewhat circuitous route. In short, he cycled through becoming an accountant and then a lawyer for ten years, followed by becoming an FBI agent whose accounting skills led him to the white collar crime squad.

But it was his welding skills that took him even further.

What his father taught him as a means to find work while going to college landed Myers on teams that investigated some of the nation’s most horrific tragedies, the Oklahoma City, Centennial Park, and World Trade Center bombing cases, to name a few, as a certified bomb technician. He testified against both Timothy McVeigh and Terry Nichols during their respective trials. Myers has also served on the Tampa Joint Terrorism Task Force and became one of the original members of the Tampa Bay Bank Fraud Task force.

A certified fraud examiner, Myers points out that most people don’t realize how massive and serious a problem money laundering is. Estimates put the amounts of money involved anywhere between $800 billion and $2 trillion. The sources are drug and human trafficking money and fraudulent schemes involving the medical, insurance and banking industries. Violence is part and parcel of these activities and destroyed lives are left in their wake.

“We really do not know the full cost of money laundering, but the estimates are staggering. Why? Because money laundering always involves cash which is very hard to track,” he explained. “In addition, the criminals are making a concerted effort to conceal their activities. Also, there are many costs to money laundering besides the obvious financial costsin lost tax revenue and government costs of enforcement.”

Following the Money

What the retired agent learned at every turn in his 25-year career with the FBI was that the first rule is: “Follow the money!”

Doing so always yields valuable clues. When there is “reasonable cause” or “reasonable suspicion” – whether by way of a tip from an informant or observation that someone’s lifestyle does not match his or her income – investigators use indirect methods of estimating income. They go to the individual’s local post office to discover where the suspect banks and from there every transaction reveals nearly everything investigators need to know.

“There can be innocent reasons for why someone’s lifestyle does not match income,” Myers said. He points to inheritance, lottery or gambling winnings or taking out loans. “These could be legitimate answers – or maybe there isn’t a legitimate answer.”


Prof. Myers joined the USF Muma College of Business faculty after 10 years as an accountant and lawyer followed by 25 years as an FBI agent.  Photo by: Aimee Blodgett | USF News

Myers’ classes fill up quickly. He is also a guest lecturer at conferences devoted to accounting and banking where the interest is technical. In fact he is participating in a panel discussion at an upcoming Florida Institute of Certified Public Accountants (FICPA)/USF conference Oct. 29 – 30. Practicing accountants attend the conference to earn continuing professional education (CPE)credits.

Myers can be equally captivating with “civilian” audiences where his adventures take listeners behind the scenes of high-profile crime scenes from the perspective of their bank accounts.

One such case involved the 9/11 bombers, “We tracked down every cent that we could that was received and spent,” Myers said. “For any investigation to be thorough, it has to include all finances.”

Not every case is as dramatic as that one but, Myers says, “Many forensic accountants gain personal satisfaction from discovering fraud. Job satisfaction is very high. Solving crimes through financial investigation is fun and exciting. No two days are the same and you are not stuck in a cubicle in front of a computer screen all day. “

In fact most days can be filled with things that take anti-money laundering personnel away from the office. In Myers’ case, he was involved with interviewing suspects and witnesses, conducting physical surveillance, testifying before grand juries, meeting with prosecutors, executing search warrants, conducting searches, serving subpoenas on banks, conducting trash pulls and mail covers, developing informants and executing arrests. His FBI terrorism financing and bombing investigations have taken him to Israel, Jordan, Lebanon, Qatar, Pakistan, Afghanistan, Thailand and Greece.

Underneath it all is an innate sense of curiosity and the love of a challenge.

“Most professionals working in this area enjoy mathematics and solving puzzles or riddles. The more you work and the harder you dig, the greater the satisfaction when you accomplish your goal.”

Fighting Back

So how do people launder money – sometimes boxes, rooms and warehouses full of cash? Some start cash businesses whereby proceeds from illegal activities get intermingled with business proceeds. “That’s one way to make money look clean,” Myers said.

“In other countries money can be laundered at a bank, but not in the U.S. We have strong regulations and compliance laws that are meant to prevent money laundering.”

Myers explains that the U.S. employs a three-pronged strategy.

Banks are legally required to report suspicious activity, including any transfers involving cash. The report is automatic if amounts of $10,000 and above are involved, but if someone walks into a bank with money covered in or reeking with what appears to be illegal drugs, that can be a cause to report.

“Tellers are the eyes and ears and the Bank Secrecy Act Administration compels and requires them to report suspicious activity,” Myers said.

The Office of Foreign Asset Control (OFAC) in the The U.S. Department of the Treasury also compile and maintain a list of criminals and criminal enterprises and no one in this country is allowed to do business with them.

The third prong involves judicial enforcement so that when federal statutes are violated there is federal prosecution.

These days, computer programs are at work looking for patterns of illegal financial activity so those who work in the field aren’t burdened with combing through dusty ledgers.

Great Job Prospects

Related clues can occur in any part of the country and “the software will flag it,” Myers said. The information is sent to the Treasury and to OFAC. With potential fines and penalties amounting to millions and sometimes billions of dollars looming to punish illegal and negligent practices, banks are taking their responsibilities more seriously than ever. High profile cases against HSBC, Citibank and Bank of New York for laundering drug cartel and other criminal funds have made worldwide headlines.

“Tampa is becoming a national center for banking industry anti-money laundering services. Citigroup, JP Morgan Chase, Sun Trust and the Depository Trust & Clearing Corporation have offices in the area with more to come,” Myers said. “With the right background, there are plenty of positions to fill.”

Typically, people in this field have come from criminal justice backgrounds, but more are needed who have accounting and business backgrounds, people who can do forensic accounting, master’s students and CPA’s.

Myers teaches his students how to handle court testimony as expert witnesses, what to do and not to do when handling criminals’ computers.

“Like any criminal investigator, the financial investigator must learn how to find, retrieve and properly handle evidence,” he said. “This usually includes recovering and preserving digital or electronicevidence when investigating financial crimes.

“Fraud is fraud,” Myers says. “There are just different delivery methods. Fraudsters can be anywhere these days. But even if you can prove that someone is committing a financial crime, you might not be able to arrest him or her.”

All of the existing international cooperation in the fight against certain transnational financial and other related crimes came together in the Budapest Convention on Cybercrime. However, Russia, China and countries in Eastern Europe did not sign on.

“The countries with thebiggest cyber criminals and offenders did not participate. But it is significant in that most of the western industrializednations came together and agreed in principle that multinational and multijurisdictional cooperation is absolutely essential to fight cybercrime.”

While money laundering is a crime unto itself, it doesn’t stop there.

“Money laundering has a great qualitative cost to our society as well,” said Myers. “By its nature, it helps promote and fund continuing criminal enterprises – think drug cartels – and corrupts our financial system and institutions which are the cornerstones of our economy. No enterprise, criminal or otherwise, can last for long without funding. Drying up the funds cripples the organization.”

"One of my favorite authors is Mark Twain who once said that the two most important days of your life are the day you were born and the day you find out why. I discovered the 'why' when I became a financial investigator with the FBI," Myers said. "I woke up every day for 25 years looking forward to going to work to meet the challenges and adventures that faced me daily. I felt my work contributed to a better society while protecting the national security interests of our country. There is great truth in the old saying that 'people who love their jobs never have to work a day in their lives.'"

Barbara Melendez can be reached at 813-974-4563

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