The 2023 Basel AML Index has brought to light an alarming escalation in global money laundering and terrorist financing risks.
This annual report, emphasizing the urgent need for effective compliance measures, describes a concerning trend: despite robust frameworks, the effectiveness of systems for anti-money laundering (AML) and counter-terrorism funding (CFT) is in decline. As the complexity of financial crime intensifies, the importance of comprehensive and effective compliance solutions cannot be overstated.
The Challenge of New Technologies
One of the main concerns highlighted by the Index, as noted recently by Australian lawyer Dennis Miralis*, is the impact of new technologies on financial crime. Cryptocurrencies, for instance, have added layers of complexity to the compliance landscape. With a 20% drop in FATF standards compliance, it’s evident that traditional approaches are struggling to keep pace with these evolving challenges.
Financial crime functions globally. So must counter-measures against it. Worldwide collaboration and the adaptation of AML/CTF strategies to the international stage are essential. Yet the global effectiveness of confiscating criminal assets stands alarmingly low at just 28%, so something must be wrong.
In the face of these challenges, law makers and regulators are not standing still, but they do face many challenges. One of the most significant is the overlap between what looks like common sense regulation and political partisanship. As legislators move forward to improve regulatory frameworks, it’s not unknown for their political opponents to obstruct their efforts. Sometimes this is for genuinely held political and philosophical views; sometimes it’s because they can see the need for regulation as a bargaining tool in a wider debate.
Versatile Solutions are essential
In this doubly challenging environment, services like Compli from Essiell Compli emerge as an ideal solution for AML and other compliance requirements. Designed to address all aspects of financial crime, including the potential interaction of AML and CTF, Compli delivers a deep and comprehensive level of protection. Continual behaviour checks – 24/7 transaction monitoring – ensure that anomalous or suspicious behaviours trigger further action.
Compli’s strength lies in its innovative approach to monitoring and risk assessment, based on the concept of a ‘Global Person’. This methodology facilitates the gathering of information from multiple databases, ensuring a thorough and cross-border perspective on customer profiles.
Two of the many significant advantages of Compli are its scalability and the ease with which it can be customized. Regardless of business size, from small consultancies to multinational corporations, Compli adapts to both commercial and compliance needs. Its flexibility ensures that businesses can efficiently manage compliance requirements, scaling up as they grow, and adapt to financial regulations that change and develop on a regular basis.
Responding to the context
The 2023 Basel AML Index serves as a timely reminder of the ongoing battle against financial crime. Perhaps one of the unspoken solutions is that it is for individual businesses to take the initiative. In this context, embracing solutions like Compli is not just a choice but a necessity. Its comprehensive, adaptable, and scalable nature makes it a formidable ally in the quest for effective compliance and demonstrable integrity.
*Basel AML Index 2023 reveals action to combat money laundering is more urgent than ever – Lexology.com – December 11 2023 –