AFC CHALLENGES address this issue . LE agencies globally should confidentially share their investigation priorities to enable banks to factor them into their AML / CTF risk-based approach . This alignment will also help to reduce the ever-increasingly high volume of low-quality SARs 6 that financial intelligence agencies are inundated with around the world . The lack of applying an intelligence-led approach with information sharing in near real-time , both domestically and internationally , is one of the largest blockers to effectively detecting and disrupting financial crime .
All enablers must be part of the solution , not just banks
Money laundering and terrorist financing techniques constantly evolve . Enablers must therefore be vigilant to keep pace with the ever-changing sophistication of financial crime . For that response to be effective , enablers must all be part of the solution and leverage innovative technology solutions and partnerships to support their efforts .
Investing in the future is vital . In 2022 , USAA Federal Savings Bank paid $ 140 million 7 after it admitted to not fixing its AML program . The bank was significantly understaffed and failed to maintain a program that met the Bank Secrecy Act ’ s requirements . USAA did not ensure that its compliance program kept pace with its customer base and revenue growth . In many cases where banks were fined in 2022 or 2023 , they failed to undertake required checks due to inadequate staffing or insufficient monitoring .
Conclusion
What is helping to transform the global efforts to combat financial crime is the deployment of innovative technology leveraging machine learning and natural language processing to automate low-value repetitive tasks , identify anomalous client activity , predict the likelihood of a potential client being subject to a SAR , and create a perpetual know your customer process to keep client records up-to-date in near real-time . These measures may help to spot anomalous activity emanating from DNFBPs that may be your clients . This can be coupled with managed services to boost internal capacity to deal with unanticipated spikes or backlogs using a scalable skilled workforce provided by a third party . Those firms can stay ahead of shifting case volumes and meet changing regulatory requirements head-on . This is something well worth planning for now , given the rise in geopolitical tensions between the West and China over Taiwan and what may happen if additional sanctions on China ensue .
Applying technological innovation and embedding highquality third-party partners can help manage financial crime risks more effectively by building operational resilience , reducing the cost of compliance and prioritizing the reporting of high-risk indicators more thoroughly and accurately . Technology that uses machine learning and natural language processing can also be combined with high-quality data to automatically identify UBO structures , screen clients for adverse news , sanctions and politically exposed persons hits , and perform network analysis to uncover previously unknown relationships .
Samar Pratt , global head of Advisory Solutions & International , Exiger
1
“ Pandora Papers ,” The International Consortium of Investigative Journalists , 2022 , https :// www . icij . org / investigations / pandora-papers /
2
“ International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation ,” Financial Crime Enforcement Network , February 2023 , https :// www . fatf-gafi . org / content / dam / fatf-gafi / recommendations / FATF % 20Recommendations % 202012 . pdf . coredownload . inline . pdf
3
Ibid .
4
“ Modernising Australia ’ s anti-money laundering and counter-terrorism financing regime ,” Attorney-General ’ s Department , Australian Government , https :// consultations . ag . gov . au / crime / aml-ctf /? ref = blockhead . co
5
“ United States ’ measures to combat money laundering and terrorist financing ,” Financial Action Task Force , December 2016 , https :// www . fatf-gafi . org / en / publications / Mutualevaluations / Mer-united-states-2016 . html
6
“ Annual Report : United Kingdom Financial Intelligence Unit Suspicious Activity Reports 2022 ,” National Crime Agency , https :// nationalcrimeagency . gov . uk / who-we-are / publications / 632-2022-sars-annual-report-1 / file
7
Dylan Tokar , “ USAA Fined $ 140 Million for Failing to Fix ‘ Rudimentary ’ Anti-Money- Laundering Program ,” The Wall Street Journal , March 17 , 2022 , https :// www . wsj . com / articles / usaa-fined-140-million-for-failing-to-fix-rudimentary-antimoney-laundering-program-11647559976 ? mod = article _ relatedinline
22 acamstoday . org