The Top 10  Most Difficult Countries for Identity Verification

The Top 10  Most Difficult Countries for Identity Verification

Download Report

    n-img-roi-cross

    Before You Go, Schedule Your Free Demo Today

    Valid Invalid number


    Note: Fields marked with an asterisk(*) are mandatory.

    n-exit-img-roi-cross

    Thank you for your demo request

    We appreciate your interest and look forward to discussing how our solution can meet your needs. Expect to hear from us shortly with scheduling details.

    Close

    Significance of AML Compliance in Money Services Business

    Significance of AML Compliance in Money Services Business

    The financial sector landscape is evolving with the advent of the FinTech industry. Many revolutionary services and products are introduced by this sector and Money Services Businesses (MSBs) are one good example of such businesses. These revolutionary innovations increased ease for the masses. But lack of KYC and AML regulatory compliance specific to this sector left loopholes for the criminals. Also, most of the money transfer businesses are showing a lack of concern towards AML compliance, which increased the fraud rate in this sector. 

    Sensing the urgency, some countries including Australia, Canada,etc. are taking steps to prevent financial crime in money services businesses. Before we explore the regulatory and preventive measures taken by these countries let’s dig deeper into MSBs as defined by the regulatory authorities. 

    If we look at the definitions provided by FinCEN, AUSTRAC, FATF, and

    FINTRAC, broadly an MSB business includes any individual, business or organization that performs the following operations as a :

    • Currency dealer or exchange
    • Issuer or seller of traveler’s checks, money orders, etc
    • Money transmitters 
    • Check casher
    • Remittance service provider

    If a person or a business conducts these operations worth $1000 or more on a daily basis than it is liable for compliance with KYC and AML regulations. 

    The MSBs are regulated in several regimes but lack of implementation and scrutiny led to an increased exploitation of this sector. Regulations are developed for AML compliance in MSB but lack of implementation is the issue. Regulatory authorities like FATF, AUSTRAC, and FINTRAC adopted a risk-based approach in MSBs’ AML regulation. 

    Primary actions required for KYC and AML compliance by MSB are as follows:

    • Complete KYC of customers (identity verification)
    • AML screening of customers
    • Getting registered with the regulatory bodies

    Why MSBs Need KYC/AML Compliance?

     

    MSBs are some of the most common victim of money launderers. Often the MSBs do not perform KYC and AML screening on their customers, and this loophole in security is utilized by fraudsters. Money launderers and terrorist financiers cannot go to banks because they often run KYC/AML screening on people before serving them. That is why criminals use MSBs. 

    They transfer the funds without being traced. Later, if a transaction is labeled as illegal the criminal will be untraceable because they use fake identities. Ultimately the service provider MSB will be deemed liable for fine.  

    So, the MSBs need to practice in-depth KYC and AML screening on their customers before onboarding them. KYC and AML compliance helps MSBs in gaining credibility and customer trust. Research found that people feel more confident with online platforms that have some sort of visible security measures like real-time identity verification, 2-factor authentication, face verification, etc.  

    Regulatory Authorities Tightening Reins on MSBs

     

    The need for improved compliance culture is identified by global regulatory institutions. Financial watchdogs are all set to eliminate money laundering from all the business sectors. This compliance culture could be achieved only if the businesses will also understand their responsibility towards eliminating financial crime from their spaces. 

    AUSTRAC Targeting Money Transfer Businesses for AML Scrutiny

     

    AUSTRAC (Australian Transaction Report and Analysis Center) is targeting the money transfer businesses for thorough implementation of KYC and AML laws in that sector. 

    In August 2019, Austrac launched the campaign against illegal money transfer businesses. This campaign requires the money transfer businesses to register with AUSTRAC and to practice KYC/AML compliance. The objective of this campaign is to reduce the exploitation of these unregistered businesses by criminals. 

    Money transfer businesses that will not register with AUSTRAC will be liable for a fine of $420,000, seven years jail or both. 

    The money transfer businesses are required to submit their International Funds Transfer Instruction (IFTI) to AUSTRAC on time. Those who fail to do so are fined for non-compliance. 

    In September 2019, the regulatory authority fined $252,000 to Compas global holdings Pty Ltd. the company was unable to report the international fund transfer between 2018-2019. 

    Not only that AUSTAC also ordered PayPal Australia to hire an external auditor at their cost to report on the fund transfer of the company to and from Australia. This order was generated after the self-reporting of PayPal on the findings of its internal report. 

    AUSTRAC is aiming at eliminating the crimes associated with money laundering through strict scrutiny of the businesses involved in high-risk fund transfers. “Money laundering enables criminal activity that causes real harm to Australians, such as human trafficking, child exploitation, illegal firearm sales, and drug trafficking.”  AUSTRAC Chief Executive Nicole Rose said in a statement. 

    Canada Increasing Pressure on MSBs (Money Services Businesses)

     

    Canada also increased pressure on MSBs and introduced some rigid KYC and AML laws for this sector. The government of Canada amended the regulations of Proceeds of Crime Money Laundering and Terrorist Financing Act (PCMLTFA). FINTRAC (Financial Transactions and Report Analysis Center) will be responsible for the implementation of these laws. 

    The new laws for MSBs have the following key points:

     

    1. The MSBs (local or international) should be registered with FINTRAC and it will have the right to charge penalties in case of non-compliance. 
    2. The financial institutions are not allowed to conduct business with unregistered MSBs. 
    3. The MSBs are entered into the reporting entities list of FINTRAC. 
    4. The AML screening, recording and reporting regulations that were previously imposed on fiat businesses are now imposed on the MSBs as well. It means that the MSBs operating in Canada will have to conduct in-depth KYC and AML screening of their customers before onboarding them. Also, they will have to maintain a record of the compliance process and should report any suspicious transactions above the predetermined threshold. 

    How Online KYC/AML Screening Will Help? 

     

    Online KYC and AML screening can be the companion of a hard time for the MSBs. The customers of these businesses are from every corner of the world so manual verification is not possible. Developing in-house verification software requires exhaustive resources and bears huge costs, so it is not a feasible solution. 

    Online KYC and AML screening solution is a cost-effective and easy solution that delivers results with high precision within a minute. It is high time the Money Services Businesses should invest in KYC and AML compliance because the regulatory authorities have identified the risk lurking in this business sector and are all set to give a hard time to non-compliant businesses. 

    Related Posts

    Blog

    Verifying Donors and Origins of Charitable Funds with Identity Verification

    Like any other financial institution, charity organisations are also equally vulnerable to moneta...

    Verifying Donors and Origins of Charitable Funds with Identity Verification Explore More

    Blog

    AML Compliance for the Crypto Sector – How VASPs Can Adhere to the Regulations

    With cryptocurrencies gaining traction and entering the mainstream, financial regulators are asse...

    AML Compliance for the Crypto Sector – How VASPs Can Adhere to the Regulations Explore More

    Blog

    AML Compliance for Money Service Businesses (MSBs) – How Shufti’s AML Screening Helps

    Money laundering has spread like a virus in today’s globalized society. Banks and other fin...

    AML Compliance for Money Service Businesses (MSBs) – How Shufti’s AML Screening Helps Explore More

    Blog, Business Technology, Financial Crime / AML, Identity & KYC

    AML Technology Eradicating the Perils of Money Laundering

    In the past few years, we have seen a substantial increase in the number of legislations regardin...

    AML Technology Eradicating the Perils of Money Laundering Explore More

    Blog

    Why online alcohol industry needs robust age verification solutions?

    “Can I see some ID?” The question brick and mortar booze stores ask or at least should ask to ver...

    Why online alcohol industry needs robust age verification solutions? Explore More

    Blog, Online Marketplace

    Document Verification Services for a Secure Freelance Platform

    Picture this you have recently started a freelance website you have marketed it properly and foll...

    Document Verification Services for a Secure Freelance Platform Explore More

    Blog

    Know Your Donor (KYD) for NPOs – Red Flags that Charities Need to Consider

    Like every other sector, non-profit organizations and charities are also vulnerable to financial ...

    Know Your Donor (KYD) for NPOs – Red Flags that Charities Need to Consider Explore More

    Blog, Identity & KYC

    Identity Verification – Key to Eliminate BEC Fraud

    Fraud prevention and cybersecurity are the major concerns of the companies in the digital era. No...

    Identity Verification – Key to Eliminate BEC Fraud Explore More

    Blog

    DHSC’s Counter-fraud Strategy to Combat Healthcare Fraud

    Healthcare remains one of the most lucrative industries for criminals with nearly $272 billion lo...

    DHSC’s Counter-fraud Strategy to Combat Healthcare Fraud Explore More

    Blog, Identity & KYC

    Why You Need To Know Your Buyer

    Online payments are fast replacing cash transactions with the top payment companies harboring 1bi...

    Why You Need To Know Your Buyer Explore More

    Blog

    UAE’s Targeted Financial Sanctions (TFS) – How Shufti Can Help Ensure AML Compliance

    Money laundering has always remained a huge challenge for global economies, and all the major jur...

    UAE’s Targeted Financial Sanctions (TFS) – How Shufti Can Help Ensure AML Compliance Explore More

    Blog

    Securing Business Operations with Risk Assessment

    The increasing connectivity and dependence of the world on technology have led to a rise in sophi...

    Securing Business Operations with Risk Assessment Explore More

    Blog

    NFT Trading and Money Laundering – How Shufti’s AML Screening Helps Combat Financial Crimes

    With revolutionary technologies and growing digitization, the digital version of artworks known a...

    NFT Trading and Money Laundering – How Shufti’s AML Screening Helps Combat Financial Crimes Explore More

    Blog, Financial Crime / AML, Fraud Prevention, Identity & KYC

    Data Breaches – Types, Sources, and Preventive Measures

    A large number of well-renowned companies are under the threat of high-scale data breaches. After...

    Data Breaches – Types, Sources, and Preventive Measures Explore More

    Blog

    e-IDV | Enhancing Fintech Onboarding, Operations & Compliance

    Fintech is unprecedentedly growing and changing as it responds to the always-changing tech landsc...

    e-IDV | Enhancing Fintech Onboarding, Operations & Compliance Explore More

    Blog

    Anti-Money Laundering Screening | Securing Digital Economies from Financial Crimes

    The increased reliance on digital banking and the advent of virtual currencies in today’s d...

    Anti-Money Laundering Screening | Securing Digital Economies from Financial Crimes Explore More

    Blog

    5 AML Compliance Trends for 2023 – New Regulations and Technological Advancements

    From digital payments to new regulations on preventing fraud and FINRA’s guidelines on penalising...

    5 AML Compliance Trends for 2023 – New Regulations and Technological Advancements Explore More

    Blog

    Enhancing security in the cryptocurrency world with KYC verification

    Almost 20 years after the legislation on combating money laundering, regulators around the world ...

    Enhancing security in the cryptocurrency world with KYC verification Explore More

    Blog

    Understanding the Difference Between Money Laundering and Embezzlement

    Money laundering and embezzlement are two financial offences involving the movement of significan...

    Understanding the Difference Between Money Laundering and Embezzlement Explore More

    Blog

    Implementing Robust Anti-Money Laundering Checks for the Insurance Sector

    Insurance companies play a decisive role in the considerable growth of an economy. It turns accum...

    Implementing Robust Anti-Money Laundering Checks for the Insurance Sector Explore More

    Blog

    Video KYC Verification – Reimaging Customer Onboarding in 2023

    As technology is advancing so do fraudsters, ringing security alarms for financial businesses and...

    Video KYC Verification – Reimaging Customer Onboarding in 2023 Explore More

    Blog

    Europol launches European Financial and Economic Crime Center (EFECC)

    Financial and economic crimes are today the leading threats that are affecting millions of EU cit...

    Europol launches European Financial and Economic Crime Center (EFECC) Explore More

    Blog

    Implementing Robust Anti-Money Laundering Checks for the Insurance Sector

    Insurance companies play a decisive role in the considerable growth of an economy. It turns accum...

    Implementing Robust Anti-Money Laundering Checks for the Insurance Sector Explore More

    Blog

    How Can 2-Factor Authentication Protect Customers Against Fraud?

    Need for Customer Authentication Mechanisms Since the existence of humanity, new innovations and ...

    How Can 2-Factor Authentication Protect Customers Against Fraud? Explore More

    Blog

    Leveling Up Identity Verification To Meet This Moment

    Companies around the world contend with two digital identity challenges that seem mutually exclus...

    Leveling Up Identity Verification To Meet This Moment Explore More

    Blog

    AML/CFT Regulations of Hong Kong: Paper Over Cracks?

    On September 15, 2021, Hong Kong’s Securities and Futures Commission issued consultation conclusi...

    AML/CFT Regulations of Hong Kong: Paper Over Cracks? Explore More

    Blog

    The Reality Behind Money Laundering through Environmental Crimes

    Environmental crimes are among the most prevailing and profiting offenses present in the world. C...

    The Reality Behind Money Laundering through Environmental Crimes Explore More

    Blog

    Online Document Verification – The Role of Shufti’s Optical Character Recognition (OCR) in Eliminating Fraud

    Document verification is the most important stage when it comes to doing online business, getting...

    Online Document Verification – The Role of Shufti’s Optical Character Recognition (OCR) in Eliminating Fraud Explore More

    Blog

    How Can 2-Factor Authentication Protect Customers Against Fraud?

    Need for Customer Authentication Mechanisms Since the existence of humanity, new innovations and ...

    How Can 2-Factor Authentication Protect Customers Against Fraud? Explore More

    Blog

    Russian Sanctions Evasion – Is the Art Industry the Next Target for Money Laundering?

    As regulatory authorities are seizing the yachts and real estate belonging to Russian oligarchs, ...

    Russian Sanctions Evasion – Is the Art Industry the Next Target for Money Laundering? Explore More

    Blog

    Covid Report Verification: New Restriction for Airports

    The Covid-19 cases have drastically increased over time and as of February 6, 2021, 18,262 new ca...

    Covid Report Verification: New Restriction for Airports Explore More

    Blog

    Risk Assessment – Helping Businesses Determine High-Risk Customers

    The 2008 financial crash was a pivotal event in shedding light on the detrimental impact of lacki...

    Risk Assessment – Helping Businesses Determine High-Risk Customers Explore More

    Blog

    A Brief Insight into Crypto Regulations in the Asia-Pacific Region

    The Asia-Pacific region is one of the areas with the highest rate of crypto adoption. Considering...

    A Brief Insight into Crypto Regulations in the Asia-Pacific Region Explore More

    Blog

    Identity Verification | A Complete Guide to Compliance and Risks

    The United Nations says $2 trillion is laundered globally every year. Of that, less than 10% is d...

    Identity Verification | A Complete Guide to Compliance and Risks Explore More

    Blog, Reg Tech

    How Identity Verification Services make Regulatory Compliance Easier?

    Financial institutions and banks have ended up in a loop of dumping billions of dollars because o...

    How Identity Verification Services make Regulatory Compliance Easier? Explore More

    Blog

    Anti-Smurfing Solutions | Safeguard Your Business Against Money Laundering Risks

    Businesses are under constant threat of financial damage. This is primarily because cybercriminal...

    Anti-Smurfing Solutions | Safeguard Your Business Against Money Laundering Risks Explore More

    Blog

    Blockchain and cryptocurrency security Guide

    Online bitcoin business might have experienced a slump in recent months but still, it remains to ...

    Blockchain and cryptocurrency security Guide Explore More

    Blog

    Strategic Evaluation and Elimination of Money Laundering in Real-Estate Sectors

    The exchange of illicit money through real estate has been the most commonly encountered method o...

    Strategic Evaluation and Elimination of Money Laundering in Real-Estate Sectors Explore More

    Blog

    License Verification for Online Transport Services

    License Verification for Online Transport Services The world of transport services has dramatical...

    License Verification for Online Transport Services Explore More

    Blog

    How OCR Helps in Fighting Financial Crimes?

    OCR, also known as Optical Character Recognition, isn’t a new technology. However, it’s use in fi...

    How OCR Helps in Fighting Financial Crimes? Explore More

    Blog

    OCR Reader | How Does it Streamline the IDV Process?

    The unprecedented growth in business automation has created a competitive market where businesses...

    OCR Reader | How Does it Streamline the IDV Process? Explore More

    Blog

    Breaking the KYC Remediation Cycle through a Risk-based Approach

    Banks have paid more than USD 30 billion over the past few years due to ineffective policies to c...

    Breaking the KYC Remediation Cycle through a Risk-based Approach Explore More

    Blog

    Top 5 Countries Impacted by Money Laundering – How Shufti Helps Mitigate the Risks

    Today, money laundering has permeated almost every regulated market and has become the most occur...

    Top 5 Countries Impacted by Money Laundering – How Shufti Helps Mitigate the Risks Explore More

    Blog

    AML Compliance and Digital Banks – Understanding the Evolving Regulatory Landscape

    The emergence of new technologies in FinTech, increasing use of digital currencies, and alternati...

    AML Compliance and Digital Banks – Understanding the Evolving Regulatory Landscape Explore More

    Blog

    AML Screening – Identifying Financial Criminals in the Art & Antiquities Sector

    There is no doubt in the fact that art and antiquities are one of the sectors responsible for bil...

    AML Screening – Identifying Financial Criminals in the Art & Antiquities Sector Explore More

    Blog

    How biometrics in visa process reduce travel difficulties

    Biometric technology is enhancing the travel industry in many ways.  Factors that drive the secur...

    How biometrics in visa process reduce travel difficulties Explore More

    Blog

    Anti-Money Laundering Compliance for Crypto Exchanges [2021 Update]

    Anti-Money Laundering compliance solutions are gaining popularity in all corners of the world. Un...

    Anti-Money Laundering Compliance for Crypto Exchanges [2021 Update] Explore More

    Blog, Business Technology

    4 Fintech trends to look forward in 2019

    FInTech has come a long way from being a mere futuristic technology and has achieved scalability ...

    4 Fintech trends to look forward in 2019 Explore More

    Blog

    KYC alternatives disrupting traditional KYC methods

    Technology is building bridges between businesses and consumers across the barriers of distance a...

    KYC alternatives disrupting traditional KYC methods Explore More

    Blog

    Navigating the Changing Digital Finance Landscape 2023

    The financial services sector has witnessed a rapid surge in the adoption of digital technologies...

    Navigating the Changing Digital Finance Landscape 2023 Explore More

    Blog

    An Insight into Money Laundering Through the UAE’s Gold Industry

    Since the beginning of time, gold has been considered a medium for payment and trading with its e...

    An Insight into Money Laundering Through the UAE’s Gold Industry Explore More

    Blog, Identity & KYC

    Digital KYC Streamlines Customer On-boarding Process

    Shufti brings forth digital KYC verification services to perform identity verification proces...

    Digital KYC Streamlines Customer On-boarding Process Explore More

    Blog

    Unfolding Telecom Frauds through Effective KYC Compliance

    The growing adoption of smartphones has naturally spurred sharing of personal data. From providin...

    Unfolding Telecom Frauds through Effective KYC Compliance Explore More

    Blog

    The Top 10 Advantages of OCR for Business Owners

    In our current data-driven and digital world, many organisations struggle with vast quantities of...

    The Top 10 Advantages of OCR for Business Owners Explore More

    Blog

    An Insight into AML Compliance in the Financial Sector [2022 Update]

    The increasing global attention towards anti-money laundering (AML) and countering the financing ...

    An Insight into AML Compliance in the Financial Sector [2022 Update] Explore More

    Blog

    COVID Certificate Verification – Mounting Cases of Worldwide COVID-19 Fraud

    Where the coronavirus pandemic has been all about social safety protocols and vaccine distributio...

    COVID Certificate Verification – Mounting Cases of Worldwide COVID-19 Fraud Explore More

    Blog, Reg Tech

    How does CDD effectively help with AML Compliance?

    CDD or customer due diligence in the banking sector and other financial firms is an important asp...

    How does CDD effectively help with AML Compliance? Explore More

    Blog, Financial Crime / AML, Online Marketplace

    Smaller Banks are in dire need of AML Compliance to avoid fines

    Smaller banks are being considered an easy target for money laundering activities because of thei...

    Smaller Banks are in dire need of AML Compliance to avoid fines Explore More

    Blog, Financial Crime / AML, Identity & KYC

    5AMLD: Implications for Cryptocurrency

    What is 5AMLD? As part of the Action Plan against terrorism, the 5th Anti-Money Laundering Direct...

    5AMLD: Implications for Cryptocurrency Explore More

    Blog, Identity & KYC

    Digital Document Verification Giving Wing to Recruitment Sites

    Document Verification: In an industry that’s all about people, it’s critical that you know that a...

    Digital Document Verification Giving Wing to Recruitment Sites Explore More

    Blog, Online Marketplace

    7 Identity theft protection practices for Business and Recuriters

    Identity theft is now no more a cause of concern for the individual users only as corporations an...

    7 Identity theft protection practices for Business and Recuriters Explore More

    Blog

    KYC Analysts: The First Line of Defense Against Identity Theft and Fraud

    An upsurge in financial transactions has led to heightened money laundering risks and terrorist f...

    KYC Analysts: The First Line of Defense Against Identity Theft and Fraud Explore More

    Blog

    FinTech and FinCrime – The Global Regulatory Landscape

    Also known as financial technology, FinTech is now among the fastest-growing industries. This sec...

    FinTech and FinCrime – The Global Regulatory Landscape Explore More

    Blog

    How can AML play a role to impede the financing of terrorism?

    Money Laundering and Terrorism Financing are global issues and there is no dispute regarding it. ...

    How can AML play a role to impede the financing of terrorism? Explore More

    Blog

    Impact of Beneficial Ownership Transparency on Real Estate Crimes

    The high price tags of real estate in the US open doors for corrupt politicians, kleptocrats, and...

    Impact of Beneficial Ownership Transparency on Real Estate Crimes Explore More

    Blog

    Trade-Based Money Laundering – How Shufti’s AML Screening Solution Helps

    International trading instruments have significant features that are making them potentially attr...

    Trade-Based Money Laundering – How Shufti’s AML Screening Solution Helps Explore More

    Blog

    A Statistical Analysis of Prevalent Crimes in the Global Financial Industry – [2022 Overview]

    Over the past few years, the financial industry has witnessed significant technological changes, ...

    A Statistical Analysis of Prevalent Crimes in the Global Financial Industry – [2022 Overview] Explore More

    Blog

    A Brief Overview of the RegTech Industry [2022 Update]

    The rising financial crimes have raised concerns of global regulatory watchdogs giving rise to Re...

    A Brief Overview of the RegTech Industry [2022 Update] Explore More

    Blog, Fraud Prevention

    Face Verification Technology Grooving in the Education Sector

    We are now in a golden age of face recognition. The main reason for rapid adoption is recognition...

    Face Verification Technology Grooving in the Education Sector Explore More

    Blog, Financial Crime / AML

    Challenges of AML Compliance under FinCEN

    AML Compliance for US based Cryptocurrency companies has been tightened by Financial Crimes Enfor...

    Challenges of AML Compliance under FinCEN Explore More

    Blog

    Age Verification for Social Media – Protecting the Younger Victims of Online Scams

    With a significant majority of students diverting from their usual school routines due to the COV...

    Age Verification for Social Media – Protecting the Younger Victims of Online Scams Explore More

    Blog

    Keeping AI Bias Out of the IDV Game with Shufti

    Consider this: 85% of financial institutions today use some form of AI in their products. The tec...

    Keeping AI Bias Out of the IDV Game with Shufti Explore More

    Take the next steps to better security.

    Contact us

    Get in touch with our experts. We'll help you find the perfect solution for your compliance and security needs.

    Contact us

    Request demo

    Get free access to our platform and try our products today.

    Get started