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Fintelekt-ABA Webinar on Fine-Tuning AML Transaction Monitoring: Key Takeaways

Fintelekt Advisory Services and Asian Bankers Association jointly presented the next webinar in the 2020 series on Fine-Tuning AML Transaction Monitoring on August 5, 2020.

The webinar was hosted by Shirish Pathak, Managing Director, Fintelekt Advisory Services and the panelists were Douglas Wolfson, Director, Financial Crime Compliance – Asia, LexisNexis Risk Solutions and Asyraf Rifaei Assrangkhuun, Group Head – AML/CFT Transactions Monitoring and Investigation Operations, AmBank Malaysia

Companies that are using more technology – are less worried about the job satisfaction of their staff. Their staff is happier because their job is more efficient, the workflow is more efficient, their ability to do more meaningful work is greater.

– Douglas Wolfson, Director, Financial Crime Compliance – Asia, LexisNexis Risk Solutions

Douglas Wolfson shared the findings of LexisNexis Risk Solution’s True Cost of Compliance 2019 survey which was conducted for the Asia Pacific financial services market.

The survey reports pointed out that while adding compliance staff is considered to be a logical solution, it is not a long-term solution. Adding manpower without investing in other areas to improve the efficiency of AML operations, such as technology, processes, etc. drives up the costs, hides inefficiencies in processes and creates employee and client dissatisfaction.

The results suggest that more is being spent on technology than on manpower (compared to the results of the survey in 2016). Greater use of technology is correlated with better job satisfaction. Higher AML compliance spend has been correlated with an improvement in the bottom-line by bringing in more efficiency.

The organisation’s approach to improve AML transaction monitoring efficiency should be to start with an enterprise-wide risk assessment and take a risk-based approach based on the identified risks. There should also be a comprehensive technology assessment. Once risks are identified, constant analysis and improvement in data and models to ensure a reduction in false positives and capturing all true positives will be possible.

Transaction monitoring should increasingly move from mere thresholds-based monitoring to incorporating behaviour patterns of customers.

When it comes to studying historical trends, organisations tend to only look for what has gone wrong. but they should also be able to look into what has gone right. That will help an organisation assess where to deploy its resources, or where to put their investment and allow them to curb spending on unnecessary areas from a technology or people perspective.”

– Asyraf Rifaei Assrangkhuun, Group Head – AML/CFT Transactions Monitoring and Investigation Operations, AmBank Malaysia

Asyraf spoke about fine-tuning AML transaction monitoring to prioritize what is important, keep up with new trends and ensure a risk-based approach.

Current AML compliance challenges include regulatory changes, the ever-increasing complexity of fraud and cybercrime, inadequate staff training, speed in the change of technology developments and the challenges in dynamically assessing the risks for each customer.

To make AML transaction monitoring more effective, organisations can look at e-evaluating the AML process, using elements such as:

  • Re-assessing the internal audit findings or recommendations from the regulator
  • Historical trends, which can help identify the organisation’s strengths and help direct future investments or spending into required areas
  • Risk assessments can help incorporate new and emerging risk trends within the industry

The key opportunity areas for organisations include:

  • Building human capital by providing up-to-date training, knowledge sharing amongst peers and developing future trends
  • Process re-engineering by identifying gaps, classifying and prioritizing higher risk alerts and collaborating with fintech companies
  • Leveraging technology developments to bring more efficiency into AML transaction monitoring.

A full recording of this webinar is available below. You can also visit our YouTube channel for recordings of past webinars.

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