Your company may be required to carry out ongoing monitoring of your customer’s accounts to prevent money laundering. However, this monitoring can become time-consuming and problematic if you’re using manual systems.
So let’s take a look at what checks are required and some of the problems faced when you’re using manual systems and how these can be overcome by using technology.
What checks are required?
If your company is subject to compliance checks, you will need to have access to multiple datasets as part of your ongoing monitoring process.
The datasets you will need to have access to will depend on your business risk frameworks. Depending on the level of checks you need to carry out, some of these datasets will need to be checked more often than others.
For example, PEP and Sanctions lists will need to be checked regularly as people and entities are added and removed. You’ve probably noticed there have been a lot of changes more recently with recent world events, so having access to the right data at the right time is essential for your ongoing monitoring.
Problem 1: Lack of knowledge of how often you need to run checks
When you’re dealing with a large number of clients, you need to identify how often you need to run checks and the nature of the checks you need to be running. This is usually defined by your industry, advisory body and compliance process.
For example, if you’re an estate agent, it’s likely you’ll need to carry out checks at the point of the transaction. However, if you’re an accountant, it’s more likely that you’ll need to carry out annual checks to make sure your clients are still complying.
While you might think this is hard to keep on top of, leveraging technology can help you. Using software such as MLVerify, you can set a schedule clients for a periodic review, on client by client basis.
However, if you have concerns about a client between checks (or if you don’t need to have a schedule, for example, if you’re an estate agent), you can also carry out ad-hoc checks.
Problem 2: Slow onboarding leading to administrative strain
Most businesses need to keep the new clients coming in so that they can survive. But when you need to deal with KYC and AML compliance, you need to both onboard the clients and carry out ongoing monitoring.
Both of these can produce administrative strain on your administrative team.
If your business is still working with manual systems, you might be overwhelmed with the scale of the monitoring that needs to take place.
However, if you’re using technology to schedule your ongoing monitoring, you’ll find that your processes can be vastly sped up; leaving you free to onboard more clients.
Problem 3: Limited budgets
Times are tight and budgets are getting squeezed, compliance teams aren’t immune to these squeezes either.
If your company is running manual checks from the start of each business relationship, you’re not going to be efficiently working while also blowing through your budget and reducing your overall profitability.
However, through the use of technology, processes are sped up which means that your teams can work more efficiently and increase your profitability.