Today, risk and compliance departments are finally getting the attention they deserve within organisations, but they face increasing workloads and intense pressure to operate efficiently because their function has traditionally been seen as a cost centre. These departments need to sustain a well-balanced risk-based approach, and the key to this is proportionality. Identifying the sources and assessing the extent of its impact to the business allows for the better allocation of resources to effectively manage and mitigate risks. While risks relating to AML, anti-bribery and sanctions screening weigh heavily on the employees working in the department, there is a lack of readily accessible customer data for them to exercise due diligence.
Leveraging Technology to Improve Risk Management
One of the challenges often encountered in compliance is the heterogeneous nature of the Asia Pacific landscape where factors like language and culture can affect the operational process of risk management. For example, people in a particular country or culture, frequently have same or similar names. Generic software can sometimes failto tell specific data or records apart as a result. This is because additional pieces of information such as biometric data or key personal identifiers are often not readily available. Adding to the complexity is the lack of consistency in the translation or transcription of names from Asian script to Latin characters. The good news is, technology can help unravel the complex structures of such identities by tapping on investigative tools.
Compliance data and screening solutions with due diligence capabilities can help organisations become more responsive to rapid regulatory changes. With the ability to scale from tens to thousands of nodes handling petabytes of data and supportingmillions of transactions per minute, organisations can rely on such solutions to help process, analyse, and find links and associations in extremely high volumes of complexdata quickly and accurately.
Understanding customers and the risk they are associated with has become an essential part of the risk-based approach, and that can be achieved with the effective use of analytics and news information. Banks and financial institutions could leverage on systems that aggregate data from international and national enforcement agencies, as well as worldwide media, to screen their customers and stay compliant. With a collection of datasets such as sanctions and enforcements, politically-exposed persons (PEPs) and adverse media being provided in a structured way while being maintained and updated on a daily basis, organizations can have access to actual intelligence and implement it onto their clienton-boarding and client-screening tools to verify that these customers are not on the blacklist.
By leveraging today's cutting edge innovation technology, banks and financial institutions in Asia have the opportunity to leverage the latest intelligence to exercise due diligence, stay compliant, and be better positioned to fight fraud, AML and terrorism.