Anti-Money Laundering Screening – Regulatory Trends and Developments

Why KYC and AML are used interchangeably?

Common opinions about KYC and AML aren’t quite distinguishable. For the uninitiated, the KYC or "Know Your Customer" is a part of AML or Anti-Money Laundering. Most of the countries have implemented KYC in various organizations, for example, the banking and financial institutions.

Over the years, drug cartels and Politically Exposed Persons have been involved in several murky transactions for illegal procurement and terrorism. Similarly, a few countries, with their nefarious designs, indulge in illegitimate activities via different routes.

The United States of America has strict export regulations to keep dubious transactions in check. Thanks to the exporters, the effectiveness of rules inked a new history in stopping frauds, laundering, etc.

Compliance Solution Requirements

Since exporters are required to comply with the trade and export regulations, the compliance solution requirements include Due Diligence, KYC screening, transaction monitoring, reporting, risk assessment, etc.

Perhaps, monitoring transactions may not drive results expected from all corners, but stringent measures and their respective implementation have a deeper impact. We can consider the example of how sanctions have benefited in a huge manner.

Regulatory Trends & Developments

In 2016-17, a plethora of significant developments took effect. We can cite the standardization of customer due diligence by the Financial Crimes Enforcement Network, which demands identification, verification, and validation of customers. Financial institutions will have provisions for risk-based profiling, monitoring, and updating of records.

Securities & Exchange Commission, Financial Industry Regulatory Authority, and other organizations have also announced examination priorities in the year 2017. Indeed, the measures introduced for AML screening or AML transaction monitoring program, etc. are key requirements.

Screening Software for Exporters

If you are an exporter and find it hard with the BIS to track the watch list screening requirements, export regulations, export license requirements, ECCN, etc. you will definitely need the help of a screening software.

A chunk of organizations/firms doesn’t involve themselves in the regulatory compliance measures, thinking they would be only harming their core business processes. However, they must understand that non-compliance would result in civil or criminal penalization by the administrative authorities.

You need to find a trade compliance professional or consultant who can provide accurate information about the requirements for export to various countries. If it weren’t the amalgamation of banned parties or countries, the entire process of customer screening would have become highly cumbersome.

Features of screening software

Explaining the fuzzy logic algorithm & related stuff may draw disinterest from the readers. Therefore, we have a simple, plain matter for you.

• Bulk Screening Functionality – It doesn’t have to be a long procedure because bulk screening functionality enables thorough search running through multiple lists. The fields, provided with data, will go for both direct and indirect matches.

• Archive – Data search history helps a lot in retrieving valuable information at a later point of time. You can trust the software for archival of screening logs, etc.

• Compatibility – The modern software upgrades enable superior compatibility with ERP and CRM systems utilized in the organizations.

• Author Info:-

• Linqs Inc writes about the differences between KYC and AML Screening and how both are key requirements for transaction monitoring and several procedures. With the help of KYC screening, banking institutions validate their customers. Similarly, organizations can benefit from customer screening and prevent any violations.

Linqs software helps you with an accurate KYC screening of customers or trading partners before entering a deal with them.