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AML Compliance Makes Know Your Customer More Important Than Ever, Report Says

Regulators are taking a deeper look at anti-money laundering and anti-bribery corruption compliance, and banks had better be prepared.

BankersAccuity, a compliance solutions provider, released a report today detailing changes and trends affecting banks in anti-money laundering (AML) and anti-bribery corruption (ABC) compliance, an area that has received a great deal of attention from regulators lately. In the past year large banks HSBC and Standard Chartered have received public backlash after they were found violating AML regulations.

And, asthe report notes, it's not just banks who have been hit hard for not doing due diligence in this area. Big multi-national corporations like Wal-Mart and Johnson & Johnson have been investigated by regulators as well.

[See Related: Renaissance of Fraud Spurs New Approaches to Anti-Money Laundering]

Clearly big players are not exempt from the discerning gaze of regulators when it comes to AML and ABC compliance today, the report says. It suggests that banks and other companies will have to make adjustments to deal with the harsher scrutiny from regulators. With the current geopolitical landscape shifting rapidly in the Middle East, it is extremely important that banks do the Know Your Customer due diligence that regulators require. Banks in the Arab world now represent a heightened for global financial institutions, the report stated. Regulators, the report added, are taking a more global approach to AML and ABC compliance.

In addition, the report said that the role of the Chief Compliance Officer is going to continue to be more significant as banks grapple with compliance in AML and ABC to fend off the kind of scandals that hit HSBC and Standard Chartered. While automating screening and reports can help with compliance, banks need to stay aware of changes in the compliance landscape to help them apply their monitoring to more effectively police themselves, the study concluded.

Jonathan Camhi has been an associate editor with Bank Systems & Technology since 2012. He previously worked as a freelance journalist in New York City covering politics, health and immigration, and has a master's degree from the City University of New York's Graduate School ... View Full Bio

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