AML/KYC Can it be fully automated?
Hi All,
Just wondering your thoughts on if you feel that AML/KYC can/should be mostly automated? Basically, I'm debating starting a company that would aim to completely automate this entire function making it easier for the Front Office to execute on their job. Since most of the back office work is purely transaction, this seems like a fairly easy win but would like to hear your thoughts.
Thanks!
A lot of the parts are semi-automated, so without giving it away I’m trying wonder how you’d go about doing that
Agreed that parts are semi-autonomous, but the service would aim to combine everything and essentially remove the human touchpoints that create the bottleneck (outside of the required follow-up Due Diligence).
Since OFAC lists are public and the process is a series of "is allowed, is not allowed" based on bank requirements, there is a lot that can be done with the introduction of Machine Learning and AI.
Seems feasible to me, would help financial services by freeing up their back office staff, and reduce the high turnover in that function (because its so monotonous), can't see a reason to not pursue this
I can see it for sure, I used to work at a regional bank and we'd get company emails about new hires, with most of them in the compliance/BSA/whatever dept, and they weren't the brightest people if I'm being honest.
So I was talking to this compliance dick back when I was at BMO. I complained to her that volcker rule is shit and should due away with it. She told me that the regulatory / compliance on the trading desk should increase. I was like what the fuck you talking about lol. These compliance folks are a complete joke. We pay for your salary, hun. Simmer down.
Please do. They do nothing but same mundane task everyday and bleed money.
I agree, it seems like the entire function can be automated.
What do you think would be the first area that we can remove the "human element" and introduce automation?
I don't know I'm not in compliance. But I did ask folks who are in compliance on what exactly do they fucking do and they said same shit. Same process. Help get rid of them please. Thx. Oh and I’m pretty sure you can google what exactly they do. Probably some reporting shit to FINRA or some shit.
There are some offerings out there that aim to do what you are talking about. I don't know how advanced they are but north capital is one my firm has looked at. https://www.northcapital.com/technology/. Our back office people are stuck in the 90s with how they run compliance and it makes me want to strangle them at least once a week so they have finally started looking into better options.
I think you could likely automate 90% of it and leave a human review layer before approval. Seems that there is always hiccups in the process at my firm.
Happy to connect you with someone in the AML/KYC space who actually knows what they are doing that I have dealt with. Guy actually understood he was there to support us complete transactions rather than bottle neck them. Guy also complained he worked with absolute morons lol. Also compliance and AML/KYC are 2 completely different things.
I'd actually be interested in doing this as well. I quite trading a few years ago and worked on my own tech focused business (it's not completely dead yet) and now doing a cs degree. Let me. Know if you ever need any help
Client onboarding has become complex with the globalisation of business. Financial institutions need to meet compliance standards of regional, national and international authorities. Organisations spend sizeable funds and time on manual checks for KYC. The KYC framework has been widened for compliance with General Data Protection Regulation (GDPR), PCI DSS, SOX, GLBA and many others.
The process can be conducted accurately and efficiently without further burdening your team.
Automation with AML analytics can help overcome the challenges financial institutions face in their onboarding processes. Anti-money laundering (AML) and customer due diligence (CDD) are the two pillars of your KYC process. They are a complex set of checks to be conducted with regularity and monitoring of clients.
To ensure organisations provide customers with a smooth onboarding experience, they can rely on professional KYC managed services.
Automated KYC verification leverages advanced technologies such as artificial intelligence and machine learning. Your clients would meet regulatory standards, as most of the processes would be automated.
Technologies used to manage, automate and integrate digital KYC processes include the following:
Together, they automate workflows by extracting data from documents and reducing the time taken for identification and verification.
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