Activity Analysis

To meet regulatory expectations, a business, regardless of size, must be able to detect when a client's activity is unusual or suspicious. After all, ongoing monitoring is the primary purpose of anti-money laundering laws. That is, suspicious activity reporting is the objective.

The sophistication of monitoring systems will depend on the nature, size and complexity of a business, as well as the volume of client activity. Regulatory risk is high if there is no dedicated transaction monitoring system.

Know Your Customer Profiling

Integration of KYC and transaction monitoring tools at the time of client onboarding will streamline AML compliance procedures and processes. This increases efficiency by enabling AML Compliance Officers to have all relevant data at their fingertips. With informed data, determinations can more readily be made with increased reliability.

Alert Handling

Management of transaction alerts should be prioritised. When Anti-Money Laundering Compliance Officers have knowledge of higher risks, they can then focus on the issues that are most critical.

Case Management

Case Management is the tool used to evidence what happens after an alert is detected. Client activity requiring escalation should be managed with a workflow system. This includes keeping a record of actions taken and outcomes. With the addition of data visualisation, the transfer of knowledge is instant. This allows AML administrators to perform at the same level as an AML compliance professional.

Management Reporting

Management has a responsibility to understand the status of anti-money laundering compliance. A system that produces dedicated reporting will inform management and boards. Tailored management reporting will significantly reduce costs linked to human resourcing.

Products and Services

All products and services should be analysed for ML/FT risks. This rating should be based on individual risk characteristics. When risks linked to products and services are known, AML Compliance Officers will be in a better position to set rules for ongoing monitoring.

Flexibility

A business should be able to readily develop a transaction rule. If systems require the inclusion of IT personnel, this may delay the implementation of the rule. Allowing an Anti-Money Laundering Compliance Officer to work independently from IT involvement will ensure a transaction solution remains up-to-date.

Rule thresholds need ongoing evaluation to ensure they reflect the current economic environment. Changes may be required as a consequence of receiving updates from AML Supervisors.

Automated Workflows

Customer onboarding should be frictionless. This requires an automated AML onboarding and ongoing monitoring system. With automation, rule alerts can be listed in a prioritised manner. Human oversight may require a change in priority order. Flexibility is key for an effective and practical compliance solution.

Informed Decision Making

A common problem with AML client profiling and transaction monitoring is the storage of data in separate systems. This extends the analysis time, and increases human resourcing, as well as causing greater regulatory risk from ageing alerts. To manage regulatory priority issues, transaction alerts should contain all relevant data connected to the alerted activity.

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