AUSTRAC has put a range of industries under a microscope this year. Recent cases of anti-money laundering (AML) and counter-terrorism financing (CTF) non-compliance have raised concern across the gaming and wagering industries, while many financial institutions are still managing the effects of the banking royal commission.
To meet regulatory requirements, ongoing customer due diligence (OCDD) and enhanced customer due diligence (ECDD) are an important part of the process for many organisations. However, costly and time-consuming legacy processes for collecting and maintaining data are still commonly relied upon to meet these obligations.
As regulations and standard compliance requirements continue to change, in the crypto market where evolving regulation makes the sector a ripe target for financial crime, businesses need to think ahead about how to keep up with regulators’ requirements in ways that do not take resources or costs away from core business operations.
You can run, but you can’t hide… from industry regulators
Particularly for financial institutions (FIs) still using manual processes and legacy technology to address AML/CTF obligations, the prospect of exploring new and automated technology solutions can be daunting. However, as recent enquiries and investigations into high-profile FIs, wagering companies, and banks have proven, there is rarely an acceptable excuse for non-compliance in the eyes of industry regulators.
Furthermore, the damage of non-compliance to the business can be severe. As well as heavy fines, non-compliance can also lead to loss of customers and customer trust, and significant operational costs to make the business compliant and allowed to continue running.
With Australians losing over $205 million to scams between 1 January and 1 May, 2022, which was a 166 per cent increase compared to the same period last year, there is a greater societal potential for money laundering and other financial crime to increase. For example, money mule accounts which can be used to funnel proceeds of financial crime or launder money are an ongoing risk for both banks and consumers.
The reputational and financial damage of being found out to be non-compliant when it comes to AML/CTF should not be underestimated, especially in a time when scams are so prolific.
Being compliant doesn’t have to be complex or costly
Despite many FIs trying to sweep OCDD under the carpet where possible to focus as many resources and efforts on their core business, the reality is that compliance and regulation does not have to involve excessive budgets, staffing resources, or time. In fact, with the right approach and an end-to-end solution that ensures nothing is missed as regulations continue to change, FIs can meet compliance and regulatory needs quickly, while adding value to other areas of the business.
Here are some examples of how businesses that need to address AML regulations can benefit from OCDD solutions, such as GBG’s greenID:
- Using verification rules to meet regulatory obligations, such as:
- Consulting and audit services to review rule sets
- Remediation to rectify and compare outcomes of new rules vs old rules
- Ongoing reverification and monitoring
- Streamlining and ensuring compliant customer management processes, including:
- Verifying against the Australian Death Check to remove deceased individuals and limit costs
- Batch remediation to reverify existing customer data for accuracy
- Batch remediation to profile any high-risk customers (e.g. PEP, sanctions, adverse media)
- Providing a simple solution to automate the collection of additional customer identification information for high risk or hard to verify individuals through multiple options including email, SMS, Internet Banking etc
- Ongoing monitoring to maintain data accuracy and compliance
If your business is looking for remediation or reverification solutions, or if you would like to discuss your AML/CTF or ECDD/OCDD requirements in more detail to find a tailored solution for your needs, contact our sales team.
For more information about GBG’s end-to-end verification solution, visit https://gbg-greenid.com/
To read more about how to make the most of OCDD technology solutions, read our blog Fast and efficient OCDD – Is compliance holding up your business?