Commercial Card/P-Card controls are expanding. They are no longer limited to preventing and detecting card fraud. Transaction audits and process audits are not enough. We are also responsible for protecting against crimes like money laundering. This applies to everyone, including end-user organizations and providers.
Cardholders’ Personal Information
At least one large card issuer has already redefined the Commercial Card application process by requiring personal information on all cardholders, such as an employee’s home address, date of birth and country of nationality. Corporate liability does not matter. Issuers need to know who the cardholders are, regardless of whether end-user organizations perform credit checks and background checks on their employees. After all, if a Commercial Card is used to facilitate money laundering or support terrorist activity, a spotlight will be on the issuer and litigation is sure to follow.
Why all the fuss now? The Bank Secrecy Act (BSA)—sometimes referred to as the Anti-Money Laundering Law (AML)—is nothing new. However, subsequent laws, such as those stemming from the Patriot Act, have added to the provisions. Banks (issuers) might just be behind the times in enacting a process for Commercial Card programs.
Action Items for Your Organization
As an end-user organization, what can you do? Employees may resist against providing personal information on a Commercial Card application, but, as individuals, our information is already “out there”—with our medical providers, insurance agents, accountants, banks, etc. Ensure card applicants understand the rationale and regulations behind the requirements. Such information serves a clear purpose. Can your organization do more to know who its employees are? Increasingly, end-users are doing “OFAC checks” on their suppliers, utilizing the Specially Designated Nationals List (SDN). Are you taking similar measures for employees? Protect your organization by making the move to redefine your internal controls—for Commercial Cards and more.
About the Author
Blog post author Lynn Larson, CPCP, is the founder of Recharged Education. With more than 15 years of Commercial Card experience, her mission is to make industry education readily accessible to all. Learn more…