In 2024, the global market for AML violation fines exceeded $6.6 billion, with regulators in the EU alone imposing over 800 sanctions for non-compliance with anti-money laundering standards in the past 12 months. These figures are not just statistics but a real indicator of how high the risks are for any international business that ignores compliance and AML audit requirements. Reputational losses, account freezes, loss of partners, and even criminal liability become inevitable consequences for companies that underestimate the strategic role of AML checks.
Why is the issue of undergoing an AML audit and building an effective corporate risk management system so pressing? Today, financial and legal regulators in the EU, Asia, and Africa are synchronizing their approaches by implementing FATF standards and EU directives, with increasing demands for business transparency and client due diligence. At COREDO, we regularly encounter cases where even experienced international companies face sudden AML audit requests or risk fines for AML violations due to non-obvious procedural gaps.
If you have doubts, this article is for you. I will explain how to pass an AML audit in an international company, avoid fines, and build compliance that becomes a competitive advantage rather than a formality. Read to the end, as you will receive not only practical recommendations but also strategic ideas based on COREDO’s real experience in the EU, Asia, and CIS.
What is an AML audit and AML check: key concepts and stages
Main stages of an AML audit for international business
In practice, the COREDO team implements the following algorithm:
- Preliminary AML risk audit: analysis of the business model, client base, payment channels used, and geography of operations.
- Assessment and testing of internal AML procedures: checking the completeness and relevance of internal policies, compliance with FATF standards and EU directives (4AMLD–6AMLD).
- Verification of KYC procedures and client due diligence: analysis of the completeness of beneficiary identification, checks against sanction lists, and monitoring of suspicious transactions.
- Transaction analysis for AML compliance: testing automated monitoring systems, detecting anomalies, evaluating the effectiveness of responses to suspicious operations.
- Final report and recommendations: preparing a report with identified risks, a list of violations, and a roadmap for closing gaps.
The role of KYC procedures and client identification
KYC (Know Your Customer) is a fundamental part of AML compliance. In international business, digital client identification, analysis of sources of funds, and detection of suspicious transactions are becoming standard. COREDO-developed solutions include the implementation of automated KYC platforms, integration with global sanction lists, and developing a “know your customer” policy at all holding levels. This minimizes the risk of being blacklisted and ensures the transparency of the client portfolio.
International standards and directives: FATF, 4AMLD–6AMLD
The Financial Action Task Force (FATF) establishes global standards for combating money laundering, while EU directives (4AMLD, 5AMLD, 6AMLD) set mandatory requirements for companies operating in Europe. COREDO’s practice confirms that integrating international AML standards and continuously monitoring changes in regulatory requirements are keys to successfully passing an AML check in any jurisdiction.
How to prepare for an AML audit in an international company
Comprehensive preparation for an external AML audit begins with an internal compliance audit and the implementation of current internal AML policies. At this stage, not only the formal presence of documents is important, but also the real operability of procedures.
Risk audit and implementation of internal AML policies
At COREDO, we recommend starting with an AML risk assessment: analyze business processes, identify vulnerabilities, and conduct an internal compliance audit. Based on the results, internal AML policies are developed and implemented, covering:
- procedures for client and beneficiary identification,
- transaction monitoring algorithms,
- AML reporting standards (including the preparation of Suspicious Activity Reports – SAR),
- regulations for internal investigations into AML violations.
Staff training and the formation of a compliance corporate culture
Effective AML compliance is impossible without regular employee training. Our experience at COREDO has shown that AML specialist training and certification programs, internal seminars on identifying suspicious transactions, and incident investigations significantly increase the company’s readiness for external audits and regulatory inspections. A compliance corporate culture is formed by involving all personnel levels in AML control processes.
Documents and regulations for successful audit passage
A full set of documents is necessary for the successful completion of an external AML audit:
- internal AML policies and procedures,
- KYC regulations,
- transaction monitoring logs,
- reports on suspicious operations (SARs),
- documents on internal investigations and compliance audit results.
AML compliance in the EU, Asia, and Africa: features and differences
Approaches to AML compliance vary significantly across regions, requiring flexibility and a deep understanding of local requirements from international business.
| Region | Key requirements and directives | Audit specifications | Documents and reporting |
|---|---|---|---|
| EU | 4AMLD, 5AMLD, 6AMLD, FATF | Strict control, emphasis on KYC | SAR, internal policies, reports |
| Asia | FATF, local regulators | Country-specific, focus on FIU | Local forms, KYC |
| Africa | FATF, regional standards | Lack of unification, risks | Simple KYC, local reports |
EU, directives 4AMLD, 5AMLD, 6AMLD, and best practices
The European Union imposes some of the strictest requirements on businesses: mandatory beneficiary identification, transaction monitoring automation, and integration with national and international sanction lists. For fintech companies and payment institutions, implementing procedures that fully comply with FATF directives and 6AMLD becomes a mandatory condition for obtaining licenses and accessing banking infrastructure. COREDO solutions for implementing automated AML systems enable our clients to successfully pass inspections and minimize the risk of AML violation fines.
Asia: local requirements and interaction with regulators
In Asia, AML compliance requirements vary from country to country: in Singapore and Hong Kong, there is strict supervision by FIUs and mandatory external AML audits for financial institutions, while in some other countries, the focus is on local reporting forms and specific KYC requirements. COREDO’s experience in supporting the registration and licensing of companies in Singapore and Hong Kong shows: the key to success is adapting internal policies to local standards and establishing effective interaction with regulators.
Africa: AML audit specifics and documentation
In African countries, there is often a lack of standardization, creating additional risks for international businesses. To successfully pass an AML check here, it is important to prepare simplified KYC procedures, adapt internal policies to regional requirements, and ensure transparency in reporting. In COREDO’s cases of supporting clients in Africa, special attention is paid to preparing local forms and interacting with national financial intelligence units.
How to avoid fines for AML violations: practical recommendations
Fines for AML violations can reach tens of millions of euros, with further consequences including account blocking, license revocation, partner loss, and reputational risks. Avoiding AML fines requires not only formal compliance but also the actual effectiveness of implemented procedures.
Typical mistakes when preparing for an AML audit
The most common mistakes encountered by the COREDO team:
- a formal approach to implementing internal AML policies,
- insufficient automation of transaction monitoring,
- outdated KYC procedures and lack of regular client data updates,
- weak preparation for an external AML audit,
- lack of internal compliance audit and incident investigation system.
Integration of KYC and AML into corporate risk management strategy
Effective corporate risk management is built on integrating KYC and AML processes into a single system. Solutions developed by COREDO include:
- automation of KYC procedures,
- integration of AML and KYC into ERP systems,
- establishing a corporate AML responsibility system,
- regular assessment of AML program effectiveness using KPI and metrics.
Interaction with regulators and financial intelligence units
In international practice, timely and accurate reporting of suspicious operations (SAR) and establishing a constructive dialogue with financial intelligence units (FIUs) are crucially important. COREDO’s experience shows that transparency, proactive positioning, and readiness for open communication with regulators significantly reduce the risk of sanctions and simplify the passage of external audits.
Technologies and automation of AML processes: modern solutions
Modern AML compliance is not possible without introducing automated monitoring systems, artificial intelligence, and RegTech solutions, which not only increase efficiency but also reduce costs.
Artificial intelligence and machine learning in AML
The deployment of artificial intelligence for transaction monitoring and anomaly analysis has become standard for large international holdings. Examples from COREDO practice show: using machine learning allows identifying complex money laundering schemes, automating the analysis of AML compliance transactions, and significantly accelerating audit passage.
Blockchain and digital customer identification
Blockchain technologies and digital customer identification open new possibilities for transparency and reliability in KYC procedures. Implementing mobile solutions and integrating with global digital identification platforms allow COREDO to implement projects for automating KYC and reducing the risk of errors in beneficiary identification.
Selecting and implementing RegTech solutions for international companies
RegTech solutions for AML involve not only automating reporting and monitoring but also integrating AML processes into corporate ERP systems, assessing ROI from new technology deployment, and regularly evaluating AML program effectiveness. COREDO’s experience confirms: wisely choosing a RegTech platform and adapting it to business specifics is the key to successfully passing an AML audit and minimizing fine risks.
Key conclusions and practical steps for business
- Conduct an AML risk audit: start with an internal compliance audit, identify vulnerabilities, and develop a plan to close the gaps.
- Implement automated transaction monitoring systems: use modern RegTech solutions and artificial intelligence for transaction analysis and identification of suspicious transactions.
- Update internal AML policies and procedures: adapt documents to the requirements of FATF, EU directives, and local regulators.
- Organize regular employee training: invest in AML specialist certification and compliance corporate culture formation.
- Integrate KYC and AML processes into a single risk management strategy: ensure transparency and manageability of procedures at all holding levels.
- Build open interaction with regulators and FIUs: submit timely reports on suspicious operations and maintain dialogue with supervisory bodies.
- Seek legal business support from experts: COREDO’s experience in international business, licensing, and AML consulting: your resource for minimizing risks and successful development in global markets.