The weakness in a bank or a financial institution becomes the target of a fraudster. Banks and financial institutions can falter the fraudsters with the help of efficient anti-money laundering schemes. Any financial institution, large, medium or small can become a victim of the treacherous plan of a criminal. To prevent from falling into the traps of such criminals it is better to have some handy methods. This post lists 4 ways to protect your financial institution against money laundering.
It is extremely tough to separate serious and potential threats from a plethora of false positives that turn during the search. There are a variety of alerts that have to be looked at to lay a net over the account in a financial institution. If the false positives are brought under control, the scope of accounts can be expanded for effective reporting. With help of AI-powered AML transaction monitoring software, constant searches can be done and the burden of false positives can be reduced.
You should investigate anyone who is involved with the transactions. For instance, if a stranger wants to offer you huge money, you haven’t hit the jackpot. It can most probably be a money-laundering scheme. Before accepting anything, conduct a thorough background check on the person. Look into whether the person has been involved in any crime. You should be aware of everyone involved in the case. Analyze the relationship of everyone who is involved in the transaction. If you are connecting with a potential client take a look at their record and how their company is registered.
Even the smallest company can establish anti-money laundering software solutions. The policy should have the instructions that should be taken or avoided. You may have to incorporate the procedures for cash handling and accounting. Having a policy established helps in direct decision-making regarding the deals and partnerships with others.
Data analytics is one of the most important ways to combat money laundering. There will be a multi-factored pattern that occurs in a particular geographic location concerning products or the customer involved. With AML solutions for banks, the pattern in the area can be recognized and can be used to come up with client models. The pattern recognized can also be employed for categorizing the potential risks and adapting new alerts. The AML can see if there is any relation between negative news and the characteristics of the account. It can be a location or any other similarity.
You have seen that AML should be used to prevent money laundering but what exactly is AML? Anti-money laundering refers to a set of rules, regulations, laws and practices aimed to prevent fraudsters from disguising money obtained illegally as legitimate income.
FinAMLOR from Finacus is end-to-end AML software solutions that enable a risk-based approach to monitor the behavior of customers for any suspected criminal activity. The software offers the industrial-best practice to monitor, review and protect your business.