Impact of Regulatory Scrutiny & AML Compliance in Real Estate

Impact of Regulatory Scrutiny & AML Compliance in Real Estate

Anti Money Laundering (AML): Criminals around the globe are targeting real estate to launder the ill-gotten gains. The political corrupts are taking large bribes and embezzle funds from their countries and send it across the world to hide that bad money. Money is stolen from the country to which they are mean to serve. Luxurious real estate is the point of attention for money launderers through which they scramble ways and find tricks to scoop up the illegal money. This money should be cleaned before it gets enjoyed by the corrupts. 

Real Estate, a fast-growing industry is under threat of money laundering.

Many nations are united and consider it a dire need to tackle money laundering problems that are growing rapidly through real estate. With the spotlight on real estate professionals, they are strongly in the need to comply with the local regulators to deter the risks of money laundering. The real estate sector should implement measures to authenticate the customers and make sure that the are selling the property to the legitimate ones otherwise it could be problematic for them when it comes to regulatory fines. Below are some of the states that are facing issues of ill-gotten money and the absence of their records. Also, how are they combating this issue by introducing legislation?

United Kingdom: According to Transparency International, £4.4 billion of the UK’s property is bought with suspicious money. In 2018, (AML) legislation was introduced according to which foreign owners were supposed to identify themselves. The purpose of this bill was to find out who is the owner of particular money. Although this bill has not been passed yet. By 2021, the registry will be made public. The property owners who fail to comply with this registry will be imprisoned for two years and fined. 

Germany: In 2017, about 30 billion of illicit funds were funneled in German real estate. These funds have no record of ownership and how the money was generated. Germany has also introduced a transparency registry, according to which all shell structures must report the property owners with the respective property. Failing to comply with it could cost them 1 million.

Singapore: To squash illicit money transfers, Singapore Parliament has passed regulations against money laundering and terrorist financing activities. In 2017, the investors in Singapore spend $37.2 billion in overseas real estate. Not only this, but their foreign real estate investment is also increasing with the current record of about $2.3 billion. Real estate owners are required to perform Customer Due Diligence (CDD) and Enhanced due Diligence (EDD) processes to check the ownership details and verify the identities who are actually buying and selling properties. The ones who fail to comply with this will be subjected to a fine of $100,000.

Canada: Real estate of Canada needs to report Finacial Transactions and Reports Analysis Centre of Canada (FINTRAC) to report the transactions that are greater than $10,000. Not only this, they are supposed to keep a track of buyers to have a record over the legitimate customers and the malicious ones.

AML Obligations for Real Estate

Just like banks and financial institutions, real estate is equally obliged to undergo practices to combat money laundering activities. Real estate brokers, firms, real estate management companies, and insurance companies need to perform CDD to ensure that no bad actors are becoming part of their company. Also to avoid hefty regulatory penalties, casinos must carry out intensive methods to avoid suspicious money flow. 

KYC: Know Your Customer, the ever-essential mechanism to undergo customer screening with the help of supporting identity evidence. The buyers should be identified and verified using the biometric authentication process, facial verification, document verification, AML, and id verification. This can help to ensure that authentic identity is onboard with your company. 

AML Screening: Anti-money laundering and Politically Exposed Persons (PEP) background checks should be implemented within the system to screen the customers against sanction lists and exposed personalities that are not allowed officially to buy or sell any property. These checks are extremely important to keep the company away from regulatory fines and value harm. Continuous and regular AML compliance must be assured and comprehensive records should be made simultaneously.

Updated AML Records: Accuity database should be updated with the latest information regarding exposed persons and criminals around the globe. This provides firms with confident AML screening which is updated and accurate. This will reduce the risks of avoiding identities that are should be in the sanction list are not entered yet.

The momentum of AML screening is building worldwide in the real estate sector. They have recognized the need of customer monitoring and verification to comply with AML legislation. The active response should be given by the customers and sector owners in adoption of these regulations and the individuals should co-operate respectively for the healthy law enforcement in the nation. Ineffective compliance can be severe in terms of local regulatory requirements. 

AML Checks

AML Checks: An Emerging Frontier in RegTech Revolution

The Anti Money Laundering (AML) landscape has been around since the signing of BSA (Bank Secrecy Act) in 1970. Financial institutions have been battling with compliance regulations since forever. Over the years the financial services industry has confronted $26 billion by way of non-compliance fines. To enable the banking sector to fulfil its compliance obligations, the RegTech industry has come up with some of the most technologically advanced solutions. They are able to enhance the capability and output of compliance teams in banks and financial service firms. From advanced analytical tools to anti money laundering checks, banks are now able to fight fire with fire.

Overspending on AML Compliance

The risk of money laundering has increased significantly due to the fact that overseas transaction volumes have increased making the financial system more vulnerable to financial crimes. The constantly changing AML regulations and the increase in non-cash payments have added to this risk infinitely as well. But the banking sector has been dealing with all these challenges by investing heavily in the expansion of their compliance teams. This has not only increased their annual spending on AML compliance – $3.5 Billion – but has made the process, if anything, more complicated than ever before. In the US compliance staff in banks has increased exponentially.

The Drawbacks of Prevailing AML Systems

For the moment, AML systems currently resemble operational units that have huge overheads and still employ manual procedures to manage client profiles. The cost of such compliance teams would have been acceptable if only they were as effective. Some of the major drawbacks of these AML systems include;

  • Large amounts of unstructured data make it difficult for different teams to accumulate and organise information. This ultimately causes operations to slow down, creating friction in onboarding procedures. Banks still resort to calling each customer individually to update their documents for KYC (Know Your Customer) procedures. Simple tasks such as these can be easily automated.
  • The systems in use for analysing client data are outdated and slow. Such legacy systems use fixed rules for analysing customer data and are unable to account for unforeseen scenarios. This rule-based approach generates a large number of false positives, that ends up wasting a significant amount of time and money to be wasted towards investigating bogus leads.
  • Outdated systems also result in erratic reporting of suspicious activity. As financial institutions deal with a large number of customer data, the system can produce an equal amount of false positives, thereby causing the compliance team to overlook legitimately high-risk cases.
  • Due diligence procedures in banks are still manual. They rely on manual identification, verification and screening of clients, which are both slow and have a higher rate of inaccuracy.
  • The complexity in financial transactions and the proliferation of faster services has made it difficult for financial companies to monitor client activity. Online payments and anonymous fund transfers also lack adequate KYC and AML procedures.

As prevailing systems are becoming more and more inefficient and costly, banks are exploring new avenues to perform AML compliance. An emerging avenue in this regard is regulatory technology or RegTech that is enabling the financial sector to implement advanced tech solutions to aid their AML compliance functions. More than anything, these systems have the ability to reduce costs and enhance the onboarding process. All such tools can make compliance systems in banks more feasible and cost-effective.

 

AML Compliance Systems and Tools

The RegTech space is now leveraging technologies like AI and big data to make streamline compliance procedures in banks and financial institutions. One such system is advanced analytics that can intelligently analyse client data and process it within minutes. The current analytical models being implemented are rather tuned to explicit regulatory and anti-money laundering requirements. Therefore, nearly 90% of the warning signals generated by them are false positives.

However, advanced analytical tools are now allowing banks to venture beyond such legacy systems. They primarily operate based on machine learning algorithms that can learn from past behaviour and issue alerts using predictive analytics. They sift through past data to look for patterns and determine legitimate and suspicious transactions. Such analytical models require large data sets to work with that financial companies can provide easily. ML algorithms help reduce the number of false results significantly, thereby saving ample time for compliance teams to investigate legitimate alerts. The manual work in such cases can be reduced by at least 50%.

The Fintech industry is still working on developing more advanced systems. They are using deep learning which is a step further from machine learning. It can be used for image processing and to imitate human speech. In short, it is able to mimic human cognition and implement intelligence towards the investigation of financial crimes like humans do. Efforts are being made to refine such processes and bring them into the mainstream.

Anti Money Laundering Checks

Another simple yet highly effective tool for improving AML compliance is AML screening. Anti Money Laundering checks also use AI to perform background checks of individuals by screening them through global sanction lists and databases. AML & CTF checks enable banks to screen out money launderers, financial criminals and Politically Exposed Persons (PEPs). Financial institutions can choose whether or not to take on a flagged person as a client or to at least classify them as a higher risk client and thus charge higher premiums accordingly.

Shufti Pro is an anti-fraud solution that uses AI and Human Intelligence to provide KYC and AML verification services to businesses. It can effectively help prevent your business from financial crime laundering through anti money laundering checks. Shufti Pro is providing ongoing PEP screening for clients wherein banking institutions can execute ongoing screening for a specific list of clients or even their entire clientele. They can also implement batch screening which allows them to screen existing customers through AML sanction lists.

Recommended For You:

 

Artificial Intelligence

AI a Blessing – AML compliance cost reduced by $217 billion

The U.S. financial firms spend approximately $25.3 Billion in terms of compliance, risk management and AML procedures. Europeans banks come close with $20 Billion annual AML expenditure.

The increasing territorial and regulatory gap between organisations and consumers has lead to a demand for digitisation of operations. Regulatory bodies owing to evolving nature of online fraud and monetary assets (cryptocurrency) are putting a safety check on every interaction between a business and its consumer. This results in a narrow gap between compliance management and profits. But fortunately technology has evolved enough to remove this barrier.

Leveraging Artificial Intelligence

RegTech has gained sure footing in the recent years. By using AI, Machine Learning and Data Analytics it gave a relatively new approach towards traditional compliance procedure. Being fairly a newer concept, it definitely faced a pushback from regulatory bodies.

However, the situation now has changed.

The Financial Crimes Enforcement Network (FINCEN) has announced its ascent for organisations to “responsibly” implement and use AI powered approach towards meeting BSA/AML requirements. U.S. regulators have given a nod to emerging technologies and their possible applications for risk management.

 

A joint statement by five (5) U.S. Agencies, The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, FinCEN, the National Credit Union Administration, and the Office of the Comptroller of the Currency stated that,

“private-sector innovation, including adopting new technologies and finding new ways to use existing tools, can help banks identify and report money laundering, terrorist financing, and other illicit financial activity.”

The first step towards engineering an AI based compliance procedure is to replace existing rule-based processes. This can be achieved by engaging transaction monitoring, and detection models with the help of Machine Learning. The inclusion of Artificial Intelligence reduces the cost of manual labour, time spent on monitoring, and inaccuracy of results with the help of intelligent solutions. These solutions are fed logic to their backend and are able to replicate a set of decisions based on past events. AI is not just a readymade solution. It gives an opportunity to organisations to train systems according to their requirements.

Banks, Payment processors and other FinTech institutes can identify relevant KYC and AML compliance processes and easily implement their AI based application. Owing to the nature of their operations financial institutions hold vast data banks. By using Big Data Analytics this data is easily divided and categorised into distinct chunks. These chunks are further assigned machine rules to “read” future transactions and apply processes based on that.

The traditional approach towards KYC and AML compliance may hinder practicality. With the help of innovative solutions organisations are now able to cut costs and reduce number of resources exhausted to secure compliant processes.

It is no surprise that the Global RegTech industry is expected is expected to grow to $12.3 Billion by 2023.

 

Read more on how RegTech makes AML Compliance effortless.

AML Compliance

AML Compliance – Korean Crypto Exchanges Join Hands to Fight Money Laundering

Cryptocurrency has been notoriously criticised for money laundering and other illicit activities ever since its inception. But with the increasing crack down on money laundering activities globally by organizations like FATF, financial regulators have been urging crypto exchanges to comply with anti-money laundering measures.

Owing largely to its decentralised nature, the crypto industry has been more often than not used for illegal activities by all sorts of criminals. Be that as it may, it is also true that Bitcoin or any other cryptocurrency for that matter was not created for this purpose. If anything the whole blockchain structure is supposed to keep all transactions completely transparent.

Nevertheless, after constant urging from various regulators, cryptocurrencies have been scrambling to meet all AML compliance measures. In light of regulating crypto companies and exchanges, three crypto exchanges in Korea have teamed up to address the issue.

Leading Exchanges set up a Hotline to Combat Money Laundering

Four leading exchanges in South Korea i.e. Coinone, Upbit, Bithumb and Corbit have recently set up a hotline that will receive any information regarding money laundering, or any other illicit activities, in real time. Crypto has been known to be used for many cyberscams including online identity theft, phishing or Ponzi schemes.

Read: KYC and AML Compliance can help cryptocurrencies to earn legitimacy

An official explained that any illicit activity would instantly be reported on the hotline and the required actions would be taken immediately. This he hoped would increase the credibility of the industry as a whole and would be productive in protecting the users as well.

With an increased focus world over to restrain money laundering activities in every form, every major country has asked crypto exchanges to implement anti-money laundering (AML) compliance measures. And it is true that many exchanges and crypto companies have been doing their best to comply with such measures put forth by each of their governments.

Effective Fraud Prevention Solutions for Crypto

Pursuant to the regulatory measures, cryptos have also been setting up fraud detection and prevention techniques to fight scams and frauds. One of these measures is Know Your Customer (KYC) verification and AML checks. They use identity verification through document and face verification to authenticate the users in order to gauge their legitimacy. Where steps like the ones taken by the South Korean exchanges are laudable, there is a dire need for more robust fraud prevention measures.

Shufti Pro is a leading SaaS product providing such fraud prevention measures through identity verification to more than 230 countries across the globe. It implements KYC verifications through an AI-based authentication procedure, allowing businesses to verify their users in real time. Shufti Pro also offers AML checks from all major regulatory authorities operating across the globe. It is seamless and can be easily integrated into a web-based interface of any given business.

Mistral Pay turns to Shufti Pro for KYC and AML Compliance services

Shufti Pro has joined hands with Mistral Pay to provide KYC and AML Compliance services to this Malta based payment gateway company. With main customer base located in European Union, Mistral Pay offers personal accounts as well as Merchant accounts to enable ecommerce business.

The collaboration between the 2 tech giants is based upon their mutual resolve of making online marketplace free of fraud and providing top-notch user experience to potential online shoppers. Because of its specific line of work, Mistral Pay was in need of an ID services provider that can verify the credentials of users to avoid the headache of cashbacks. This was becoming a major concern for Mistral Pay in an increasingly user-centric ecommerice world. Artificial Intelligence based KYC services of Shufti Pro proved to be a perfect match for the rigorous demands of ecommerce payments. Shufti Pro offered Mistral Pay to perform each document verification process in 30-60 seconds. The verification services suite of Shufti Pro also included AML compliance, that was another major requirement for Mistral Pay, as they wanted to avoid being subjected to unnecessary regulatory oversight.

CEO of Shufti Pro, Mr. Victor Fredung explains the partnership between the 2 companies in following words:

Shufti Pro is honored to be working with a client like Mistral Pay that is offering seamless payment services to such a large number of individuals as well as businesses at the same time. Our team of experts sat down with Mistral Pay executives and came up with practical workflows to not only ensure the validity of user credentials but to make the process entirely hassle free for end users”

Mistral Pay targets to make ecommerce payments easier for its users and Shufti Pro intends to make that resolve of its partner, a success story. Shufti Pro’s customization and support for large number of documents – especially European documents – will really help Mistral Pay to perform KYC authentication before bringing customers onboard their payment gateway.

GDPR Compliance was also a major factor for Mistral Pay in their decision to select Shufti Pro as their partner company for KYC and AML Compliance services. Non-compliance to GDPR could have caused million of dollars in regulatory fines to Mistral Pay but Shufti Pro has already ensured that its services are GDPR compliant which also safeguards Mistral Pay from any impending regulatory fine, in lieu of data collected for KYC or AML compliance

__________

About Shufti Pro

Shufti Pro is an emerging name in identity management and KYC/AML. It was founded on 31st October, 2016 in Bath, UK. The goal of the company is to enable its clients with seamless customer experience, fraud prevention and undeterred revenue generation. The company offers state of the art SaaS, which engages Artificial Intelligence and Human Intelligence. Businesses can now conduct easy digital verification processes with lesser friction and more advanced technology. Currently offering its services for all countries of the world along with Universal Language Support, the company is located in United Kingdom with its global office in Sweden. Please visit Shufti Pro here.

Shufti Pro Limited

info@shuftipro.com

190 Englishcombe Ln, Bath, United kingdom

About Mistral Pay

Mistral Pay is a Malta based payment services provider that is enabling online businesses in conducting e-commerce without worrying about payments and transactions. Accepting payouts from various means and payment modes, Mistral Pay is primarily used by ecommerce businesses based in European Union as third party payment gateway.

ONTology Signs MOU with Shufti Pro

Shufti Pro signs MOU with Ontology for Technical Collaboration

BATH, UK – (October 11th, 2018) Shufti Pro has recently signed a Memorandum Of Understanding (MOU) with Ontology to work together for KYC and AML integration. Both these companies will collaborate to provide digital identity services all the while building on the trust ecosystem established by Ontology.

Ontology is a digital identity firm that has formulated a blockchain based distributed identity network. ONT IDs from Ontology support individuals, businesses, assets, objects, and affairs to authenticate and verify themselves in this digital age. The distributed identity network allows its users to create multi-factor identity portraits that can be verified, certified and used for identity verification on multiple platforms. On the other hand, Shufti Pro tends to verify digital ends of a person’s identity using a hybrid of Artificial and Human intelligence. It provides real-time verification results for a large number of solutions and services provided for digital identity verification.

Shufti Pro and Ontology shall work together to develop and refine digital identification tools that will enable businesses for online fraud prevention and identity theft protection. The MOU stipulates that both companies will work to provide compliance ready solutions for KYC and AML solely based on Ontology blockchain network. This joint collaboration will also focus on improving the overall accessibility of digital identification services into various markets across the globe.

Ontology’s Co-Founder Andy Ji explained the importance of this joint collaboration in the following words:

“The emergence of blockchain technology creates opportunities to discover potential and promising solutions. Ontology is pleased to begin this journey with Shufti Pro, combining blockchain technology with identity verification services, providing a blockchain-based end-solution for KYC/AML services”.

Speaking on the cooperation, Victor Fredung, CEO of Shufti Pro, said: “We are pleased to be starting our partnership with Ontology. We believe that the combined use of new and innovative blockchain technology with cutting-edge ID and identity verification technology is a powerful combination for global business operations.”

The MOU states following principle avenues of joint collaboration between the two companies for future:

  1. Ontology will provide technical expertise and consultation on Distributed Ledger Technologies.
  2. Both parties will collaborate in the development of KYC/AML solutions on the Ontology distributed blockchain network infrastructure
  3. Joint PR and marketing promotion of products and services.

This joint partnership between the two tech companies will usher in a new era of technological advancement in the field of digital identity verification services. With an aim of making the online marketplace secure against identity frauds, frequent cash-back requests and users with fake financial information, Shufti Pro has taken steps for superior customer service and top-notch data security.

About Shufti Pro

Shufti Pro is an emerging name in ID verification services. It was founded on 31st October 2017 in Bath, UK. The goal of the company is to enable its clients with seamless customer experience, fraud prevention and undeterred revenue generation. The company offers state of the art SaaS, which engages Artificial Intelligence and Human Intelligence to provide ID verification services. Businesses can now conduct easy digital verification processes with lesser friction and more advanced technology. Currently offering its services for all countries of the world along with Universal Language Support, the company is located in the United Kingdom with its global office in Sweden.

Please visit Shufti Pro here.

Shufti Pro Limited

info@shuftipro.com

Unit C401, Westfield Shopping Centre,

Ariel Way, London, W12 7FD

About Ontology

Ontology is a diverse, integrated, distributed trust network and the infrastructure for building a trust ecosystem. Ontology encourages trust cooperation and allows projects of all shapes, sizes, and technologies with different business scenarios and compliance requirements to pass through Ontology’s chain networks and take advantage of the distributed trust network how they see fit.

Shufti Pro partner With Flexentral

Flexentral joins hands with Shufti Pro for KYC & AML

BATH, UK – (October 8th, 2018) Shufti Pro has partnered with Flexentral to provide its next-generation KYC and AML compliance services to this blockchain based company. Flexentral is basically a developer and publisher of a digital platform software that intends to simplify work management and make it flexible for managers and workers. Shufti Pro is an AI-based end-to-end identity verification SaaS product that offers multiple validation services to its customers.

Flexentral tends to introduce a harmonized platform where digital advancement of the modern age are utilized to make project management and task completion hassle-free for users. In doing so, it covers the entire work cycle starting from the recruitment of employees, leading to contracting and eventually resulting in payment at the completion of the assigned task. Powerful analytics tools are also part of the product so that project managers can get a visual brief about worker performance and progress they have achieved in light of payroll paid to workers.

To put it simply, Flexentral wanted to cater 2 categories of users: one who needs work done and the other that can do that work. But creating a reliable platform where trust dictates the terms of engagement led Flexentral on a search for a reliable KYC partner. Due to its blockchain based technology, in-app payments to workers from managers were also required to be made in a cryptocurrency. “Grain” was chosen as the token currency to pay for the services rendered by workers for managers on this digital platform. To ensure honest and transparent transactions, AML compliance was also necessary. The search of Flexentral concluded with Shufti Pro that promised similar flexibility as was desired by the European tech company. Shufti Pro can perform real-time KYC verifications with AML screening checks being performed in the background.

Talking about the collaboration between the 2 companies, CEO of Shufti Pro, Mr. Victor Fredung, said:

We were impressed by the business model of Flexentral as it had a lot of things common, in principle, with Shufti Pro. We are all for transparency and trust. Same was the intention of folks at Flexentral. Teams of experts from both companies shared ideas and worked diligently to integrate KYC verifications and AML checks from Shufti Pro into the digital platform from Flexentral”

Shufti Pro is already a GDPR compliant product which further made the decision easier for Flexentral to opt for this AI based ID verification product. Data security and usage of personal data for an explicit purpose were already clearly defined as per GDPR guidelines ensuring that Flexentral will not encounter any unnecessary compliance issues or monetary fines. The integration process was flawless as Shufti Pro maintains an updated API and SDK integration documentation.

About Shufti Pro

Shufti Pro is an emerging name in ID verification services. It was founded on 31st October, 2016 in Bath, UK. The goal of the company is to enable its clients with seamless customer experience, fraud prevention and undeterred revenue generation. The company offers state of the art SaaS, which engages Artificial Intelligence and Human Intelligence to provide ID verification services. Businesses can now conduct easy digital verification processes with lesser friction and more advanced technology. Currently offering its services for all countries of the world along with Universal Language Support, the company is located in United Kingdom with its global office in Sweden.

Please visit Shufti Pro here.

Shufti Pro Limited

info@shuftipro.com

Unit C401, Westfield Shopping Centre,

Ariel Way, London, W12 7FD

About Flexentral

Flexentral envisions an open, honest and transparent labor economy, servicing tasks and work with a platform providing instant insight in compliance, diversity and budget.

AML Compliance For Banks

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 their smaller base of operations and little to no regulatory oversight for their account holders, increasing the need of AML Compliance. It has been recently revealed by Mr. Jesper Berg, head of Denmark’s official watchdog tasked to oversee banking operations around the country. He made this claim after country’s biggest bank was found to be used to perform billions of dollars worth of money laundering. This money laundering activity was being performed by not some criminal elements of Denmark but financial criminals from Russia, Azerbaijan and Moldova used country’s largest bank Danske Bank A/S to carry out money laundering of nearly 8 Billion USD.

Why Smaller Banks are at risk?

Smaller Banks, even in highly regulated economies, are vulnerable to money laundering activities because of the nature of their operations. Financial regulators have already seen trends where smaller but frequent transactions are used to launder money on behalf of criminal elements. Even in the above stated case, USD 8 billion worth of money laundering was done from 2007 to 2015. So the smaller banks, with moderate assets and not so large banking operations are neglected, or at least not vigilantly monitored by financial regulators across the globe for AML Compliance. This creates a window of opportunity for money launderers and financial criminals to whitewash their funds using multiple accounts in branches of smaller banks in moderately populated cities where the staff might not have much understanding of AML compliance

Anonymity of these far off branches and even smaller size of bank creates opportunities that can be easily exploited by financial criminals even before any unusual activity comes on the radar of financial regulators tasked with AML compliance. This is a perfect example of flying under the radar without being noticed for an extended period of time. A string of such banks accounts can create a paper trail that can not be easily identified in the haystack of a country’s banking sector.

Another factor that leads to the smaller banks being exploited for money laundering activity is their lax approach towards AML compliance. Not only shortage of funds lead to this approach but the typical customer base of such banks also require them to be not vigilant about the kind of transactions being performed from the banks’ accounts. In a world where major banks are spending billions and are staffing hundreds of employees in their AML compliance departments, smaller banks find it hard to allocate such huge resources to ensure compliance with AML guidelines set forth by national regulators.

AML Compliance for Smaller Banks

But as a legitimate business operating within the territorial boundaries of a country, the mere small size or insufficient resources of the banking organization does not serve as an appropriate excuse for being used as an accessory to a crime like money laundering. A bank found involved in money laundering activities, even unwillingly, risks to be fined multi million dollars in regulatory penalties that for sure is death blow to the operations of such smaller banks. It means that money laundering is a genuine cause of concern not only for larger banks but smaller banks are even at greater risk if found to be in breach of AML Compliance.

So in the absence of satisfactory monetary resources and keeping in line with a futuristic vision, fintech turns out to be the only savior for smaller banks around the globe. There are many AML Compliance solutions available around the globe that can enable smaller banks to follow AML guidelines of their national regulators without spending a fortune on compliance departments.

Shufti Pro is an ideal choice for smaller banks, no matter which part of the world they are operating in. It is an Artificial Intelligence based end-to-end verification services provider that is offering KYC as well as AML Compliance to a worldwide clientele.

It has a huge data bank comprising of 1000 Watchlists and sanctions list in addition to data from 3000 databases maintained by national, regional and international watchdogs. This vast databank is updated every 14 minutes and a small bank will be playing a very small amount to ensure AML compliance against their customer base.

Fintech AML Compliance

Asian Banks push for greater Fintech to cut down AML Compliance cost

Asian Banks are now asking their regional and national regulators to allow more fintech in order for them to cut down AML compliance costs. Recent months have seen regulators and financial watchdogs – especially in Far East and Southeast Asia – slapping huge fines and tightening overall AML guidelines. Both these measures have an impact of double edged sword for the revenues of Asian banks that simultaneously dwindled in the light of multi million dollar fines and compliance costs. This is the reason why banks are looking to employ cheaper yet effective fintech to perform AML compliance in place of large swaths of compliance staff.

 AML Compliance Costs

Asian Banks have millions of accounts, tens of thousands of bank branches and billions worth of american dollars being transferred on daily basis. This huge scale of operations demand an equally huge workforce to ensure compliance regarding AML guidelines issued by financial watchdogs and regulators. On average, in 2017 there were 307 employees tasked to make operations of a financial institution compliant with AML guidelines applicable in this region. This is more than 4 times the number of employees that were working on average in a financial institution to perform AML Compliance in 2016.

HSBC, one of the major Asian banks having strong presence in the region, spent in excess of USD 3 Billion, just in 2017 for AML compliance and tripled its human resource in the span of 4 years. It has now 8600 employees on its payroll only performing compliance based operations.

What Fintech can do for AML Compliance?

Right now, fintech is the only logical and workable solution for Asian banks to cut down cost on compliance measures without seriously affecting their crusade against money laundering activities. Despite a large number of AML Compliance staff, financial criminals have been able to find out ways to circumvent AML Compliance measures of these banks, leading financial regulators to fine huge monetary penalties over these banks.

In a recent case, Commonwealth Bank of Australia was fined hundreds of millions of dollars by Austrac when it was find out that thousands of accounts were not being monitored under AML compliance guidelines of financial watchdog. Fintech can defeat both known and unknown money launderers and can detect suspicious transactions  in far less time as compared to a human staff of compliance officers. Automated systems developed by Fintech can run background checks in a few minutes to check the past transaction history. In case of an usual amount of online funds transfers, a 24 hour vigilant AML Compliance solution can redflag the account for the banking staff. 

Why regulators are reluctant about Fintech?

Well there is no stated or on-the-record resistance shown by regulators for introduction of fintech in order to provide AML Compliance. Infact, financial watchdogs have been encouraging about the use of fintech in banking sector and financial institutions. But they always require banks to utilise technology and manuals that are pre-approved by the regulators for use in banks and financial institutions. This creates a bottleneck to gain approvals for fintech given the limited technological expertise of financial regulators and even smaller number of individuals tasked with approval of fintech. Bureaucratic behaviours and red-tape slows the process of approval of fintech, thus forcing banks and financial institutions to employ higher number of workers and spending millions of dollars while fintech software spend months and months in approval grind mill.

Best Solution

When it comes to fintech for AML Compliance, there is hardly any match of the Artificial Intelligence backed Shufti Pro. It is an end-to-end ID verification SaaS product that provides a comprehensive suite of verification services and one of them is AML Compliance. Shufti Pro has gathered a large databank to perform background checks for AML Compliance. This huge dataset contains information from 1000 Watch lists, Sanction lists and Politically Exposed Persons list. In addition to that, individuals and enterprises present on 3000 databases of international watchdogs are also part on this databank.

Shufti Pro makes sure that every new customer of a bank or financial institution is checked against this vast databank to ensure that no person red flagged in any part of the world for his/her involvement in financial crime, becomes part of bankroll or account list.

id verification services

Shufti Pro joins hands with Norwegian game studio ArtPlant for ID Verification Services

BATH, UK – (July 4, 2018) – Shufti Pro has partnered with a Norway based game studio, Artplant to provide ID verification services in addition to AML Compliance. The partnership between the two tech companies will be focused towards Blockchain based games designed and operated by ArtPlant like Parsec Frontiers.

ArtPlant is not a run of the mill games studio but it is established with a sole vision to develop multiplayer games keeping blockchain in mind and giving an advanced level of control and stake to the gaming community. In order to provide a safer access to its valued gamers and to prevent them from interacting with scammers, ArtPlant turned to the tried and trusted services of Shufti Pro. 

Documents Verification services from Shufti Pro will enable ArtPlant to authenticate the identity of potential gamers who are interested in becoming part of their global gaming community. To safeguard in-game purchases, ArtPlant is also utilising AML compliance solution of Shufti Pro to offset any financial risk to their online gaming community and future ventures.

ArtPlant was in need of ID verification services that can provide worldwide support without being limited to verification of gamers from only a select number of countries or particular region of the world. Thus the worldwide coverage provided by Shufti Pro made it the ideal choice for the management of Artplant. Talking about the deal stuck between the 2 companies, CEO of Shufti Pro, Mr. Victor said

” It is a great pleasure for us to be working with ArtPlant to provide secure gaming environment for a worldwide gaming community. Shufti Pro has always strived to find out new ways to make online marketplace secure and our recent partnership with ArtPlant clearly showcases our resolve to widen our horizon of ID verification services.”

Shufti Pro and Artplant share a mutual vision of an online world that is free of any scams and fraudulent activity. With Artplant’s specific expertise based in blockchain based multiplayer gaming, Shufti Pro was able to integrate its Artificial Intelligence based solution into pre-existing gaming portal of ArtPlant.

Now every Identity Document provided by future gamers of ArtPlant will be validated within 30-60 seconds and at the same time, robust system of Shufti Pro will perform background checks for AML Compliance. Shufti Pro will be conducting AML Background checks against 1000 Watch Lists and Sanction Lists in addition to 3000 databases maintained by world renowned financial watchdogs like UN, Interpol, Austrac and FSA.

________

About Shufti Pro

Shufti Pro is an emerging name in verification services and KYC/AML. It was founded on 31st October, 2016 in Bath, UK. The goal of the company is to enable its clients with seamless customer experience, fraud prevention and undeterred revenue generation. The company offers state of the art SaaS, which engages Artificial Intelligence and Human Intelligence. Businesses can now conduct easy digital verification processes with lesser friction and more advanced technology. Currently offering its services for all countries of the world along with Universal Language Support, the company is located in United Kingdom with its global office in Sweden. Please visit Shufti Pro here.

Shufti Pro Limited

info@shuftipro.com

Unit C401, Westfield Shopping Centre,

Ariel Way, London, W12 7FD

About ArtPlant

Artplant is a Norway based Games studio involved in development of exciting new games. In 2015, Artplant bought IGI brand from Square Enix. The company is venturing into blockchain based games with Massive Multiplayers Online Worlds game titled “Parsec Frontiers” allowing greater control to future gamers. This game will be providing a complex virtual economy with an option for tradable assets stored and tracked on blockchain, creating a more involved community of gamers.

More posts