Criminal activity is on the rise. Money laundering and money scams are rampant across the world. It keeps compliance officers on the go all the time trying to keep up with all the instances that they felt the need to step into for regulations issues, or actual criminal activity. Anti-Money Laundering (AML) compliance and defense need to be placed at the top of the list of priorities. Here are the top five tips to keep you compliant, and to keep you out of jail.
- Improved Searches-Technology has added a layer of protection that can be automated through programs and AI systems. A substantial amount of false red flags must be dealt with every day. Compliance officers are hard pressed, at times, to keep up with them all. AI systems can automatically search through the system on a continuous basis, finding transactions that may need to be checked out. This will decrease the amount of false hits, leaving more time for compliance officers to track leads and transactions that are actual crimes.
- Open Lines of Communication-Financial institutions need to be able to communicate with the compliance officers, and vice versa. Lenders are usually the ones that see new money laundering attempts, which can be shared with the officers. From there they will share the information with all the other companies that are on the communication lines. The faster that this information can be spread, the faster the criminals can be stopped and dealt with.
- Analytics-This is a key function of any AML compliance This part of the program will put everything into algorithms that the system will break down and analyze. Any patterns that it detect that could point to illegal activity will be called out and printed out in black in white. These reports point compliance officers in the direction that they need to be pursuing. This goes along with the first point above. It lowers the amounts of false red flags, leaving more time to investigate what needs to be investigated.
- Organizational Programs-The old school system of keeping files in personal computers in each location does not give a good chain of communication between various locations. That is why many financial institutions are taking advantage of the storage capabilities of the cloud, and blockchain. It keeps all the information in one area, and when acquiring new locations, they can be connected to it as well. It will allow open communication lines back and forth to compliance officers, and to other companies.
- Training-Employee training is the first line of defense for every location. Online or in person, the first people to have their hands on a transaction are the ones that will be able to pick up on a transaction that is not quite right. The analytics and compliance officers will eventually catch the discrepancies, but not for a while. Businesses rely on the front-line workers to catch them before they get through into the system. Every laundering or scamming attempt that can be stopped before it gets footing is a win for all financial institutions, as well as their customers and clients.
AML compliance must be a top priority in all companies that deal with money. The tips above will help you focus your energy in the direction that it needs to go. Take the time to learn about all the recent technologies as they come out and implement them into your business. That is if they apply to your specific situation.
One of the most important aspects of compliance and regulation that you need to keep in mind is that communication is key. As with every other aspect of personal and business life, if you do not have a good line of communication with your employees and other institutions, you are dead in the water before you have even started.