Newcomer's Guide to the AML Galaxy

The Newcomer’s Guide to Consulting Solutions for AML Compliance


When I first started doing research about AML compliance, one of the first things I realized was how inaccessible good AML compliance solutions have been historically. Banks were always the primary users of programs for AML compliance and they needed the best and most comprehensive solutions possible. With entire departments dedicated solely to AML compliance and protecting their interests, banks didn’t have to worry about affordability or efficiency. The main concern with those institutions is effectiveness by any means. But where does that leave the little guy in need of an AML compliance solution, the companies that don’t have the resources or personnel to dedicate to an AML department?  What can they do? Here I investigate one solution.

The chance of becoming an unwitting conduit for a money laundering scheme is becoming greater for small and medium-sized enterprises (SMEs) recently. Criminals are adopting more sophisticated means of circumventing the traditional defenses against money laundering. SMEs can become easy targets if they don’t keep up their guard. At the same time, regulatory requirements have gotten tighter and the consequences for failing to comply have become more harsh.

Companies with in-house solutions are at increased liability when it comes to these regulations. So how can you minimize your liability and improve your AML regime? Outsourcing your AML compliance solution is one idea. This method is cost efficient and works to mitigate company liability. But outsourcing isn’t without its risks. Sharing confidential data with a third-party can be risky, if you aren’t careful.

Here are a few things to consider before your organization makes the plunge into third-party compliance solutions.

Improvements in AML Policies and Infrastructure

Traditional enterprise AML compliance solutions require a lot of investment and ongoing manpower to run effectively. These systems were not developed for SMEs and as such, and can be difficult for small companies for small companies to source the resources to run them. In-house AML compliance regimes need to be maintained. For smaller companies, this can be a huge disruption. Outsourcing your AML compliance alleviates these potential stressors by taking the onus off of the company and putting it in the hands of experienced professionals. A team that can handle:

  • Reviewing your existing AML controls
  • Preparing and helping with the implementation of a robust AML compliance program
  • Preparing your organization for audits

Access to CAMLO Services

Every organization should have a chief AML officer (CAMLO) to head its AML compliance program. These individuals receive regular training on anti-money laundering practices. They also stay up-to-date with money laundering trends and use this information to align the existing AML regime of an organization with changing laws and regulations. However, acquiring the services of a chief AML officer is considered a luxury that most SMEs cannot afford. If you’re considering outsourcing your AML compliance, check that the service provider offers you the equivalent of a CAMLO. The addition of a CAMLO can improve the quality of your AML compliance program and help you meet global compliance standards.

Access to Technology

Some AML compliance firms make use of technological solutions that help automate AML procedures. This can prove to be extremely cost-effective for small organizations that that use/employ manual methods. These tools also help improve the accuracy and speed of AML-related screening and decision-making. You can process new clients much faster and stick to the pre-requisites of your AML regime without inconveniencing a client.

To Sum It Up

Some organizations cannot outsource their compliance activities due to the nature of their operations. For others, outsourcing is definitely an alternative. However, it’s important that you understand the security risks of outsourcing your AML compliance. Opting for a reputable company with positive reviews is one way to avoid a breach of security.

KYC2020 isn’t just an AML Software solutions provider. Our team of CAMS™ and VSkills™ certified AML specialists can help you with your consulting and outsourcing needs. We have experience working with, and understand, the unique needs of SMEs, virtual currency operators, ICOs, Charities, and MSBs. Learn more about our consulting services by clicking here.



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