Money laundering is a term often heard and observed all over the globe. But how exactly does it impact the life of a layman? Do compliance officers and financial institutions employ such tools that combat this bizarre activity? To get to know about AML compliance, keep updated with AML Watcher. Your curiosity is justified, and AML Watcher is here to assist you.
AML Solutions and Tools Urgency
Financial institutions (FIs) increasingly focus on combating financial crimes by developing tools like sanction screening, watchlist screening, PEP screening, and corruption monitoring tools. These tools help to monitor transactions and detect suspicious activities like money laundering. Integrating these industries within the banking industry can reduce the risks associated with money laundering. This includes upholding procedures, risk-based KYC-AML policies, ongoing risk analysis, programs for AML-KYC compliance education, internal controls, and audits.
Study Analysis: Urgency of AML Regulations
This study analysis: “Impact of anti-money laundering legislation in the United Kingdom and European Union,” published in the International Journal of Economics and Management Sciences, sheds light on the urgency of money laundering that has increased due to the rapid advancements in communication, technology, and financial information. Money laundering is a criminal activity that takes place outside of regular financial and economic data. The amount of illegal money made by drug trafficking and organized crime, as well as the degree to which these funds are laundered, were the subjects of a study carried out by the United Nations Office on Drugs and Crime (UNODC). 3.6% of the world’s GDP was made up of illicit proceeds in 2009, of which 2.7% (or USD 1.6 trillion) were laundered. According to IMF estimates, every year, between two and five percent of the world’s GDP gets laundered. It is now mandatory for banks and other financial institutions to set up particular procedures to stop and identify money laundering.
This research paper aims to examine the UK’s and the EU’s anti-money laundering (AML) laws and how they affect society. The research will look at how much the law changed to combat the funding of terrorism and organized crime, how it affected local business communities, and whether or not it imposed significant restrictions on companies that made it harder for them to operate. The study is grounded in normative legal research concerned with the values, standards, and functions of laws, rules, agreements, and doctrines. To combat organized crime and terrorism, the EU government has transformed the current AML Regulations into a law. The law has, however, raised the expenses and work that the private sector—such as businesses—must do to comply. With the 4th Money Laundering Directive (4MLD) taking effect in all EU member states as of June 2017, the UK has effectively implemented anti-money laundering rules and regulations. Financial institutions, private company owners, and people have all been harmed by the legislation’s increases in expenses, delays, and inconveniences. According to estimates from the British Bankers Association, members spend at least £5 billion a year on core compliance related to financial crime. However, the public sector’s efforts to tackle financial crime have not been without criticism.
But this provokes a question: After eight years, are AML regulations and solutions that are efficient and robust enough to fight illicit activities like money laundering?
Pro AML/KYC Tools
Maintaining manual AML compliance can be challenging, especially when dealing with high-risk clients. Pro-AML and KYC tools are essential for financial institutes to ensure that deposits stay in an account for a set period and combat financial crimes. Money laundering is the act of shifting funds acquired through illegal methods into the official financial system to conceal their trustworthy source. As banks handle millions of transactions daily and are more vulnerable to financial crimes, AML is essential to the banking sector. Stricter client identity protection regulations result from the growth of online payments and technology developments. Overall, AML tools, AML case management, and screening are integral parts of AML compliance for financial institutions.
Wrapping Up
In conclusion, money laundering is a criminal activity that takes place outside of regular financial and economic data. To combine efforts to maintain AML compliance, efficient tools like AML Screening tools need to be adopted. Visit AML Watcher to learn about product knowledge and efficient screening. With five free screening attempts, get your 5-day free trial to have a robust experience of AML Watcher’s services.
