The Importance of Ongoing Monitoring for AML Compliance

Anti-Money Laundering (AML) compliance is crucial for businesses in the legal and financial sector to prevent the risks of money laundering and terrorist financing. As part of a robust AML compliance policy, ongoing monitoring plays a critical role in identifying and mitigating potential risks. In this article, we will explore the relationship between AML, ongoing monitoring, and how Verify 365’s AML solution can streamline and promote internal efficiency in the ongoing monitoring process.

What is AML Compliance?

AML compliance refers to the policies, procedures, and processes that businesses in regulated sectors must follow to prevent, detect, and report suspicious activity related to money laundering and terrorist financing. AML compliance is a legal requirement in most jurisdictions, and failure to comply with AML regulations can result in significant fines, legal action, and reputational damage.

What is Ongoing Monitoring?

Ongoing monitoring is the process of regularly reviewing and updating client information to identify any potential changes in risk factors that may require further investigation. It is an essential part of a robust AML compliance procedure, as it allows businesses to keep track of their clients’ activities and ensure compliance with regulatory requirements.

Ongoing monitoring includes several components, including:

Sanction list screening

Checking clients names against national and international sanction lists to identify individuals or entities associated with illegal activities.

Watchlist screening:

Checking clients names against lists of individuals or entities that pose a potential risk to the business, such as politically exposed persons (PEPs) or individuals with a history of financial crime.

PEPs and Sanction Checks:

Checking clients names against databases of known PEPs and sanctioned individuals or entities to identify any potential risks.

Transaction Monitoring:

Reviewing clients transactions for any suspicious activity, such as large cash deposits, wire transfers to high-risk jurisdictions, or unusual patterns of behaviour.

Why is Ongoing Monitoring Important?

Ongoing monitoring is crucial for businesses in the financial sector as it helps identify and mitigate potential risks associated with money laundering and terrorist financing. By regularly reviewing customer information, businesses can detect any changes in risk factors and take appropriate action, such as conducting further due diligence or filing a suspicious activity report (SAR).

In light of recent developments, such as sanctions and the current circumstances of Russia and illegitimate funds, ongoing monitoring is more critical than ever. Businesses must be vigilant in their ongoing monitoring processes to ensure compliance with regulatory requirements and mitigate potential risks associated with money laundering and terrorist financing.

How Verify 365’s AML Solution Can Help

Verify 365’s AML solution is a comprehensive platform that includes tools and features designed to streamline and promote internal efficiency in the ongoing monitoring process. The platform includes:

Global Sanction list screening:

Verify 365’s solution includes national and international sanction lists, which businesses can use to screen customer names and identify any potential risks.

Ongoing watchlist screening:

Verify 365’s solution includes databases of known PEPs and individuals or entities with a history of financial crime, allowing businesses to identify and mitigate potential risks.

Comprehensive PEPs and Sanction Checks:

Verify 365’s solution includes databases of known PEPs and sanctioned individuals or entities, enabling businesses to conduct thorough due diligence on their customers and ensure compliance with regulatory requirements.

Transaction Monitoring:

Verify 365’s solution includes features that allow businesses to monitor customer transactions for any suspicious activity, such as large cash deposits or wire transfers to high-risk jurisdictions.

The implications for firms that fall short

Failing to perform ongoing monitoring can have serious implications for firms, both in terms of regulatory compliance and reputation. With constantly changing regulations and evolving client circumstances, firms must stay on top of compliance requirements to avoid exposure to financial crime and penalties.

Using advanced technology solutions like Verify 365 helps businesses to identify and mitigate potential risks associated with money laundering and terrorist financing. Verify 365’s AML solution includes tools and features designed to streamline and promote internal efficiency in the ongoing monitoring process. By implementing ongoing monitoring, firms can sleep well at night knowing that they have taken appropriate measures to protect their business and their reputation.

In contrast, firms that automate the ongoing monitoring process can benefit from the efficiency and accuracy of a system that can quickly screen against dynamic, up-to-date global databases to identify changes in client risks and exposure. Verify 365’s AML solution comes with 24 hour refresh daily ongoing monitoring, based off automation this allows admins to fully automate the ongoing monitoring process and set a client or matter file to notify the firm, depending on the risk level assigned to the client or matter.