Transforming AML Compliance with Technology – Takeaways From the Experts at the ACAMS AML Conference

Shaun Creegan, Managing Director Risk and Compliance
Vishal Ranjane, Managing Director Risk and Compliance

To those overhearing conversations at the ACAMS Conference in Las Vegas last week, terms like “robotic process automation”(RPA), “artificial intelligence” (AI) and “machine learning” (ML) may have sounded like buzzwords. While many anti-money laundering (AML) professionals in attendance recognize these terms as technological advancements that have the power to add efficiencies and realize major benefits for institutions when integrated into their “business as usual” (BAU) processes, others remain skeptical about the benefits and adoption of these technologies. To those shaking their heads and asking, “Are we there yet?” we feel the answer is a resounding “Yes.”

These innovative technologies are being applied to a variety of compliance and risk management processes across many institutions, as we speak. Due to the volume and complexity of regulatory requirements for Bank Secrecy Act (BSA) and AML and financial crime compliance and the robust programs required to support them, there is a vast opportunity to deploy these technologies within the AML and financial crimes compliance space.

How to best tap into these opportunities was the subject of a knowledge-sharing session during the conference, in which we were honored to participate along with other industry experts. Below, we share key takeaways from the panel discussion outlining the critical steps towards transforming an AML compliance program using these technologies:

  1. Understand the problem you’re trying to solve. When an institution is considering an RPA, AI or ML solution implementation, it is important to narrow the focus to the issue it is seeking to solve. Failure to identify the real problem and apply the solution to that problem can leave institutions with a result that falls short of expectations. Executives should identify and prioritize the areas where their teams are spending most of their time and effort and document specific opportunities for increased efficiency. Start with a pilot that solves a specific problem and use that example to gain acceptance and support for additional automation projects.
  2. Clean the data. The technologies in question require quality data to fuel their results. Lack of clean data is one of the highest barriers to the successful implementation of regulatory technology. It’s important for institutions to work with their data and technology teams to orchestrate the data and enrich it with the attributes necessary to achieve the desired result. Data integrity, data quality and overall data governance are of equal importance in achieving the desired outcome.
  3. Assess vendors and perform necessary due diligence. If the institution plans to partner with a vendor for one of these technologies in order to move quickly during adoption, it is critical that the institution assesses the available vendors across key performance criteria and conducts the necessary due diligence to mitigate the risks of engaging with a third party. Offering an attractive technology platform is not enough. The organization must ascertain that the vendor also has the experience, capital, resources, scalability and risk management controls to support the needs of the institution.
  4. Participate in sandboxes and test environments. By starting small and actively participating in industry sandboxes where new technology can be tested, institutions can vet potential applications in a safe environment with input and collaboration from industry peers and regulators. Across the globe, regulators have demonstrated their willingness to participate in such environments and in some cases are even investing in them to enhance their understanding and ensure alignment with expectations.
  5. Push forward and keep the dialogue open. People are just as important to the success of an implementation as the underlying technology and data. If the lines of communication among data, technology and compliance teams are not open, the organization will be building a car they won’t know how to drive. Maintaining transparency and a dialogue among those working with, implementing or supporting the technology and key stakeholders will go a long way to help ensure alignment, results and satisfaction.

As institutions continue to move in the direction of AML compliance transformation, the role of the BSA/AML officer will likely evolve into one that requires careful navigation of both the regulatory and technology landscape. Embracing the change, active learning and evaluation of opportunities, and keeping the above road map in mind can help these leaders face the future with confidence.

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1 comment

  • take aways from your ACAMS conference is on point! Absolutely on point. Compliance in AML/BSA is becoming more and more critical as the digital landscape widens, not to talk about Mobile Financial systems evolution and its wide ecosystems. Most indefinitely, risk and compliance professionals must be abreast with the changing times of digitization, else we will soon find ourselves out of touch. The digital transformation must be embraced within the Risk and Compliance functions and acquiring systems is key, as risk and compliance is a key enabler of businesses. The challenge has always been aggregating all that manually collected data, once we can drilling down to the specifics of understanding the risks and requirements and make sure these are all collected within a system, automation becomes easy. Clean data is critical of cause, management’s partnership in light of transparency also in support of this digital transformation where risk ins concerned is key.