How can you prepare for AML Compliance – Ultimate AML Guidelines For Starters

Richard M. May 27, 2018 6 minute read

01 Compile AML Compliance Policies
02 Value AML Compliance

Anti Money Laundering Compliance, commonly known as AML Compliance, is something that banks and financial institutions are getting very cautious about because of huge fines and regulatory oversight attached to it. In a globalized world, where funds can be transferred from from one continent to another in few minutes, financial risk analysis and due diligence is becoming essential. Client satisfaction is also crucial because you don’t want to lose business because of snail-paced AML compliance procedures. In a nutshell, anti money laundering compliance should be balanced between customer satisfaction and regulatory compliance. So here are the things that banks and financial organizations must do to prepare for anti money laundering compliance.

Compile AML Compliance Policies

These AML Compliance policies will serve you in three aspects. Firstly, they will help your clients to understand that what kind of transactions or financial dealings are not welcomed in your bank or financial institution. By signing on these policies, your customer will be acknowledging the fact that they are liable to any judicial proceedings in case they are found involved in any money laundering or financial criminal activity using your services. Secondly, these policies will give your financial or banking regulator a clear idea about your intent for risk management and due diligence. Lastly, these AML Compliance policies will be a source material for employees in your bank or financial institution when dealing with transactions or funds of suspicious nature.

Value AML Compliance

It is important to understand that AML Compliance is not an unnecessary practice or another “regulatory” headache. AML practices testify your commitment to anti-graft initiative of governments and international organizations. In a civilized world, there can be no room for criminal elements and monetary funds are at the heart of any criminal operation. So it is necessary that banks and institutes hold special training for their employees to better educate them about (AML) anti money laundering Compliance.

Most of the times – as seen in many cases around the globe – mid-to-high level management of financial institutions is found to be in cahoots with criminal crowd in laundering money. A bank or a financial institution cannot declare this to be an individuals’s act and absolve themselves of any wrongdoing. Constant focus on AML Compliance is necessary and workshops must be held on quarterly basis or on annual basis to bring up to date knowledge to your employees about regulatory guidelines related to AML.

Things To Focus

Risk analysis is the easiest step that needs to be taken for for anti money laundering Compliance. Protection against financial risks become easier, especially when you know about the red flags that will go up once someone is using your financial services to launder their dirty money. A Bank or financial institution has to be vigilant about transactions that imitate money laundering activities like:

Sudden Increase in funds of an account
Multiple transactions to hide the laundering activity
Transactions made from accounts that mainly deal in cash
Funds coming from world regions with persistent history of money laundering
Transaction to or by individual or companies that have suspicious financial history

Third Party AML Compliance Solutions

Utilising services from a reputable third party technology partner offering AML compliance solutions can reduce half your efforts for AML Compliance. This will make the process of anti money laundering Compliance not only robust but risk assessment will be done in much less time. Shufti is one such end-to-end identity verification solution that uses Artificial Intelligence and thorough background checks to ensure anti money laundering Compliance for its customers.

Shufti has a huge data bank compiled from 1000 watchlists and 3000 databases published by World’s most reputable monetary organizations that are working to curb financial crime risks like money laundering. The mega data bank used by Shufti for cross-checking individuals and businesses include information from US Marshal Wanted, UN Consolidated List, SECO and DFAC lists in addition to thousands others. This huge data bank is updated every 14 minutes and Shufti’s robust system takes only 30-60 seconds to perform a background check against this data bank.

Due diligence is fast-tracked by a third party technology partner as it reduces the labor of manual background checks performed by a bank’s employees. Products like Shufti are an economical alternative of huge departments devoted for compliance against money laundering activities. Real time monitoring and updated data banks provide banks and financial institutions a smart tool to avoid monetary fines and streamline their business activities in accordance to AML Compliance.