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AML: 6 Techniques for Businesses to Stay Compliant

The financial services sector and registered businesses are required to fulfil a set of legal and ethical compliance regulations. One of the most important of these and one which has gained sufficient ground over the recent years is the anti money laundering (AML) compliance. A number of banks and financial institutes have been fined over the recent years for not complying with money laundering regulations issued by financial regulators and governments. Ever since the financial crisis of 2008 banks have paid nearly 204 billion in regulatory fines.

However, the culture of noncompliance is gradually coming to a halt as businesses see the sense in complying with AML laws. For a couple of years, global regulators have been issuing harsher sanctions for banks and governments for not complying with AML rules. Such stringent measures were introduced when the global community realised that money laundering activities are increasingly being linked with terrorism and drug trafficking. Authorities like FATF, FinCEN and FINMA etc. have increased scrutiny of banks, businesses and even entire government regimes to curb the plague of money laundering. Thus, businesses and particularly financial institutes are now being made liable to scrutinise their customers properly.

What is Anti Money Laundering Compliance?

At times banks and businesses also fail to comply with AML regulations because of a lack of understanding of what is anti money laundering compliance. Simply put AML compliance refers to any measures implemented on behalf of a business entity to ensure their clients and customers are not conducting any illicit activities – including money laundering – using the bank’s platform. This can include a number of compliance measures like ongoing transaction monitoring, customer due diligence measures, AML checks and suspicious activity reporting. Some easy steps for businesses to stay compliant with AML regulations can include;


The foremost step towards building a stronger compliance structure is to build awareness within the institute. It is important to study the regulatory requirements of financial regulators and governments in the jurisdiction your business operates in. Proper research into the regulatory structure of the area is a must for every bank. This will allow them to understand their compliance needs and thereby help them implement the proper compliance tools for their business. This can allow the management to make better and timely decisions regarding the implementation of AML rules.


Apart from creating awareness about AML regulations, the front end staff also needs to be aware of the compliance regulations. The culture of compliance trickles down from the top executive leadership down to the line workers. The executives of the company need to set a tone and structure for implementing AML policies for the organisation. Their high expectations can then motivate the management to set concrete goals in order to achieve the desired targets. Thus proper goals can then encourage the compliance officers to improve their performance and ensure the systems operates according to a set standard of compliance regulations.

Training and Educating Employees

In order to ensure that compliance is a part of an employee’s daily routine, frequent educational techniques need to be implemented in order to ensure they completely understand compliance management. Frequent training modules regarding the compliance framework of the company can be organised to keep the staff informed. Techniques like microlearning can also be used to ensure that the staff understands the regulations.

Using Modern Age Technology for Compliance Procedures

Technology has played perhaps the most vital part in helping to achieve better compliance. Manual and outdated systems have failed banks and financial services institutes. However, modern age tech including artificial intelligence and machine learning have opened new avenues in the market of FinTech. AML solutions like transaction monitoring systems, KYC checks, and suspicious activity reporting have been introduced by SaaS companies to help banks streamline their compliance procedures. Such systems have reduced the number of false positives and improved the time and authenticity of risk reporting procedures. In addition to that solutions are also available for banks to conduct proper customer due diligence in real time through digital document verifications, facial scans and AML background checks. AML checks can verify a client’s name through global money laundering watchlists and media outlets to check their financial and political exposure.

Incentivising Employees

Once the compliance staff manages to implement a stellar compliance structure within the organisation that manages to curb a significant amount of fraud and illicit activities, it is only fitting for the management to dole out proper incentives. A proper reward structure can motivate the staff to maintain their success and to further enhance their performance and to make improvements to it.

Incident Reporting

Reporting any incidents at the right time is half the task of the compliance team. Effective reporting can immensely reduce the risk of money laundering. Thus systems and intelligent compliance team when combined can ensure suspicious incidents are reported on time and appropriate action is taken accordingly.


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