Examining The Issues With Today’s AML & KYC Strategies
                     Examining The Issues With 
Today’s AML & KYC Strategies
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• Do you think checking your customers 
verbally is enough? 
• Do you think that everything comes crystal 
clear in front of you? Or does the customer 
tell you everything the truth? I don't think it 
is anywhere difficult to make a person go 
mad with words and fake documents, 
especially to financial institutions, but this 
can be undone when technology comes into 
play. 
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• With the increasing money laundering cases, the financial institutions 
need to have a full-fledged program monitoring the customer's data and 
the function smartly reducing the chances of any kind of fraud & for that 
AML and KYC solutions have been adopted. These have come up as the 
biggest opportunities for combating money laundering cases with smart 
technologies that can regulate the work environment, provide early 
detection of changes, manage the criminal activities by keeping an eye on 
the process, meet all the requirements, etc.
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• The biggest problem an institution face is finding the right person/employees for 
their organization that can meet the technology demands. Technology has already 
reduced human efforts and an error made by everything turning automatic, but 
now the problem is to hire the staff. In fact, according to the study conducted by 
PWCGlobal, “Nineteen percent of those surveyed claim that their ability to hire 
experienced staff is the biggest challenge to AML compliance.”
• Also not every technology used these days can combat the crimes, some specific is 
needed in which AML and KYC are leading. Financial institutions face countless 
challenges with data quality. It takes nerves to bring a complete technological 
change in the organization and without an adaptive staff; it becomes very difficult 
because no organization can see the eye-watering wastage of money and inefficient 
processes.
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• One of the greatest challenges of detecting criminal activity is the 
fact that some money laundering activities go undetected. One 
study suggests that “only 50% of money laundering or terrorist 
financing incidents were detected by system alerts.” The alerts 
received earlier could save the loss and if in case missed then the 
institution has to face significant financial loss. These can further 
lead to many severe consequences putting a question mark on the 
company executive’s liability.
• Another major challenge is the money and time wastage on the 
false positive. It happens quite often when the names of legitimate 
customers match those on a list of fraudsters. This false positive put 
a burden on the firm's investigation as to how to correct the 
screening they have performed. Only an automated process can 
reduce this burden. These have been some of the common issues 
for the compliance team competing with the tech.
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