financial compliance


The latest technology is essential for your bank or financial institution’s financial compliance plan. Here are some reasons why.

Regulatory Compliance

Regulatory agencies look favorably on organizations that keep up with the latest compliance technology and they are using predictive analytics to meet anti-money-laundering (AML) compliance standards. Your bank or financial institution can reduce false alerts by more than half and reduce compliance costs. Since predictive analytics can encode more information about an account or a customer’s activity, it’s much more reliable than descriptive analytics.

Demand for know-your-customer (KYC) analytics is growing. Capital markets and banks in the retail sector have strict regulatory requirements that increase compliance costs and restrict fee-based revenue. Even though technological advances help banks and financial institutions collect large amounts of data, the organizations face various challenges compiling data to build strong relationships, improve return, and reduce risk. AML software lets banks properly document, understand, and proactively manage data as it moves across organizations and systems. Banks are then able to maintain customer relationship management (CRM) standards and comply with KYC norms.

Cloud-based AML solutions are emerging. Organizations can increase efficiency and reduce costs of utilizing expensive information technology infrastructure. The pay-per-use model provides access to AML software at all times and places to multiple users. Small businesses typically use this software because of its cost effectiveness when compared to on-site solutions.

Adoption of AML software by medium-sized businesses is increasing. In earlier years, these companies faced limited choices when finding solutions to promote top business performance. Companies didn’t require or couldn’t afford the features of the enterprise-class software.  This limits them to freeware, low-end, or open-source solutions focused on the server or network monitoring. Because of increasing awareness, these businesses realize they need a solution that maintains their reputation and prevents money laundering and fraud. New AML vendors have begun offering software to capitalize on this. Pricing models, capabilities, and ease of management make these products appealing to medium-sized companies.

Ongoing Process

Because of increasing financial compliance regulations, your bank or financial institution must continually update its AML software to stay proactive in identifying fraudulent activity. Transaction monitoring must be updated to scan and analyze transaction data and account information. Watchlist filtering is needed to screen new accounts, current customers, beneficiaries, and transaction counterparts against terrorist, criminal, and other watch lists. Automation of regulatory reporting is required to file suspicious activity reports (SARs), currency transaction reports (CTRs), and other regulatory reports. AML software must also provide a detailed audit trail to show regulators your bank’s or financial institution’s compliance efforts and respond to subpoenas or information requests from regulators or law enforcement regarding accounts or transaction activity.

Utilize the latest technology to stay on top of financial compliance. For further assistance with this or related topics, contact the trained staff at CarterWill Search & Flex today!

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