Title: Money laundering risk judgement and decision-making: influences of customer due diligence process and bank employees' expertise

Authors: Yusarina Mat-Isa; Zuraidah Mohd-Sanusi; Siti-Sahirda Sabri; Paul A. Barnes

Addresses: Faculty of Accountancy, Universiti Teknologi MARA, 42300, Bandar Puncak Alam, Malaysia ' Accounting Research Institute & Faculty of Accountancy, Universiti Teknologi MARA, 40450, Shah Alam, Malaysia ' Faculty of Accountancy, Universiti Teknologi MARA, 40450, Shah Alam, Malaysia ' Paul Barnes and Associates Limited, Nottingham, NG13 9NG, UK

Abstract: This study examines the influence of customer due diligence (CDD) process and bank employees' expertise on their judgement and decision making when assessing money laundering risk. The authors utilised an experimental approach where a case-based questionnaire was gathered from 122 employees in three major banks in Malaysia. Results indicated a significant relationship between the extent of the CDD process with bank employees' judgement and decision-making in assessing money laundering risk. This relationship is moderated by employees expertise, which indicates that it is crucial for the right employees with suitable qualifications to be employed as CDD process can be done better with enhanced articulation and informed judgement. The findings could provide useful insights into the judgement capabilities of bank employees with reference to the rigorousness of the CDD process and their expertise in assessing risk.

Keywords: money laundering; risk judgement; decision-making; CDD; customer due diligence; banks; expertise; experimental approach; case-based questionnaire; risk.

DOI: 10.1504/IJEBR.2021.116299

International Journal of Economics and Business Research, 2021 Vol.22 No.1, pp.1 - 20

Received: 25 Sep 2019
Accepted: 16 Mar 2020
Published online: 16 Jul 2021 *

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