Overview

Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) have evolved from compliance obligations into critical national security imperatives. Illicit finance destabilizes economies, enables terrorism, empowers authoritarian regimes, and threatens global security. As financial crime grows more complex – fueled by transnational organized crime (TCOs), digital assets, and artificial intelligence (AI) – the private financial sector sits at the front line of defense.

This article explores the intersections of financial crime, geopolitics, and technology, drawing on FATF’s latest reports, U.S. Treasury strategy, and emerging enforcement actions. For compliance, legal, and risk professionals, the message is clear: AML/CFT frameworks are now a frontline tool in economic statecraft, requiring robust oversight, advanced analytics, and cross-border cooperation.

Key National Security Risks

  • Transnational Crime and State Actors:
    Groups like Russia’s Wagner Group, Iran’s IRGC, and Turkey’s SADAT blend state power, organized crime, and illicit finance to evade sanctions, fund conflicts, and expand influence.
  • Terrorist Financing (TF):
    Often uses legal funds for illicit purposes (“reverse laundering”). FATF reports highlight fragile zones (e.g., Sahel) as new TF hotspots, with growing convergence between terrorism, organized crime, and natural resource exploitation.
  • Corruption and Kleptocracy:
    Corruption corrodes governance, distorts markets, and empowers authoritarian regimes. Estimates: 2–5% of global GDP lost annually, with offshore finance enabling kleptocrats worldwide.
  • Digital Assets:
    Crypto fundraising by Hamas, cyber theft by DPRK, and sanctions evasion by Iran show how digital assets are exploited despite growing regulatory frameworks. FATF’s “Travel Rule” and U.S. FinCEN guidance attempt to close gaps.
  • Artificial Intelligence:
    Criminals use AI for deepfakes, phishing, automated laundering, and cyber-enabled financial crime. While AI enhances compliance tools, it also lowers barriers for illicit actors.

Regulatory and Policy Landscape

  • Global Cooperation:
    FATF, INTERPOL, UNODC, IMF, and World Bank drive standards, information sharing, and asset recovery initiatives.
  • U.S. Strategy:
    • Treasury’s Strategic Plan (2022–2026) prioritizes combating illicit finance.
    • Trump Administration (2025) issued “Strengthening American Leadership in Digital Assets” EO, promoting USD-backed stablecoins, rejecting CBDCs, and framing crypto as central to U.S. financial and security strategy.
  • Emerging Legislation:
    Proposed Financial Technology Protection Act (2025) would strengthen oversight of crypto-related illicit finance.

Compliance Challenges

  • Scale of Illicit Finance: Estimated $800B–$3.6T annually (2–5% of global GDP) is laundered; <1% recovered.
  • Complexity: Traditional risks (e.g., bulk cash, TBML, shell companies) now overlap with cyber-enabled crime, AI-driven fraud, and decentralized finance.
  • Private Sector as “Sixth Domain of Warfare”: Financial institutions are critical actors in U.S. security strategy, expected to deploy AML/sanctions compliance as part of national defense.
  • Enforcement Pressure: Cases like OFAC’s $216M penalty on GVA Capital show regulators’ expectations for gatekeeper diligence in monitoring ownership structures and sanctions risks.

Strategic Priorities Going Forward

  • Strengthen Global Standards: Harmonization of AML/CFT, anti-kleptocracy, and sanctions frameworks.
  • Enhance Technology Use: AI, blockchain analytics, and integrated compliance platforms for KYC, KYT, UBO, and anomaly detection.
  • Improve Asset Recovery: Target criminal networks by seizing assets and disrupting value chains.
  • Integrate AML with Security Policy: Treat financial compliance as a national defense tool.
  • Public–Private Partnerships: Expand safe-harbor frameworks and intelligence sharing between regulators, law enforcement, and financial institutions.

Bottom Line

AML compliance is no longer just regulatory housekeeping. It is a strategic necessity for safeguarding national security, financial stability, and democratic resilience. The convergence of geopolitics, organized crime, digital assets, and AI demands robust compliance programs, global coordination, and private-sector leadership in what has become the newest domain of warfare.

About the Author: Alma Angotti

Alma Angotti is a recognized expert in financial crime compliance and economic sanctions with more than 30 years of experience in both regulatory enforcement and global consulting. Alma has held senior enforcement roles at the U.S. Securities and Exchange Commission (SEC), the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) and the Financial Industry Regulatory Authority (FINRA). She brings deep subject matter expertise in regulatory compliance, including Bank Secrecy Act/Anti-money Laundering (BSA/AML), sanctions, and counter-terrorist financing (CFT). 

At FTI Consulting, Alma advises clients on compliance risk assessments, remediation strategies, enforcement preparedness and regulatory investigations. Her clients include global and mid-sized financial institutions; global fintech firms; digital assets and payments institutions; stablecoins and cryptocurrency platforms; broker-dealers; hedge funds; casinos; and multinational corporations. 

Alma serves on the advisory boards of the Global Digital Asset and Cryptocurrency Association and the Digital Dollar Project. At FinCEN and FINRA, she designed and led the AML enforcement programs and regularly trains regulators and government officials worldwide on AML and financial crime compliance matters. Additionally, she has been approved to be an independent compliance monitor by federal and state regulatory agencies, including the SEC, the Office of the Comptroller of the Currency (OCC) and the New York State Department of Financial Services (NYDFS). 

About the Author: William Jannace

William Jannace is an Associate Professor at the Dwight D. Eisenhower School for National Security and Resource Strategy/National Defense University, where he teaches courses on economics and finance and national security. He has also served as an expert witness for The Bates Group on securities litigation matters. He is also an adjunct professor/lecturer at Fordham School of Law, Global Financial Markets Institute, and Metropolitan College, where he teaches courses covering Capital Markets/Digital Assets/Securities Regulation and Corporate Governance; State Capitalism, AML/Cybersecurity; Geopolitics/Geo-Economics, and U.S. Foreign Policy/International Relations, and Grand Strategy. 

Mr. Jannace had previously worked at the American and New York Stock Exchanges, FINRA and several investment banking firms. He was also an account executive at Georgeson and D.F. King where he worked on proxy fights and tender offers. He has also served as a consultant for The World Bank and the Asian Corporate Governance Association. He has also lectured at the U.S. Army War College.

Mr. Jannace has also conducted overseas training programs for the: Russian Securities Commission/Stock Exchange; The Capital Markets Authorities in: Uganda, Burundi, Tanzania and Kenya; Saudi Arabian Capital Markets Authority; Securities and Exchange Board of India; Ukrainian Securities Commission/Stock Market; Romanian Securities Commission; Jordanian Securities Commission; Capital Markets Authority of Turkey; Albanian Financial Supervisory Authority; New York Institute of Finance- Beijing/China, the Taiwan Stock Exchange and for IOSCO in Spain. 

He is a member of the faculty advisory group of Board Intelligence. He is also a CIArb Fellow, a member of the Association of Certified Anti Money Laundering Specialists, International Institute for Strategic Studies, New York International Arbitration Center, and Bretton Woods Committee. He is also a supporter of the National World War II Museum, American Battle Monuments Foundation, and National D-Day Memorial. Mr. Jannace received his JD from New York Law School, and his LL.M. in Corporate, Banking, and Finance Law from Fordham Law School. 

The views expressed herein are those of the author(s) and not necessarily the views of the Dwight D. Eisenhower School for National Security and Resource Strategy/National Defense University, The Department of Defense, and FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals. FTI Consulting, Inc., including its subsidiaries and affiliates, is a consulting firm and is not a certified public accounting firm or a law firm. FTI Consulting is an independent global business advisory firm dedicated to helping organizations manage change, mitigate risk and resolve disputes: financial, legal, operational, political & regulatory, reputational and transactional. FTI Consulting professionals, located in all major business centers throughout the world, work closely with clients to anticipate, illuminate and overcome complex business challenges and opportunities. www.fticonsulting.com. 

Download article