GLOSSARY:  The Money Trail
Hawala
Smurfing
Shell Company
Charities
Correspondent
Banks
Suspicious
activity reports
Commodities
Wire transfers

What's this?
No bank can have branches everywhere, so "correspondent banking" relationships - where a financial institution agrees to carry out transactions on another's behalf - are entirely normal. The custom is especially useful for small banks in out-of-the-way locations.

What's the problem?
Not all of the larger banks are particularly careful about who they have the relationships with. And if the bank at the other end is lax on checking who its customers are, they can find themselves processing transactions they would never have permitted if they originated closer to home.

What's changed?
In many countries, new legislation mean banks are responsible for checking correspondent transactions as if they were their own. The level of concern expressed by the banking community would suggest that the rules are seen as a significant toughening up of the regime.