AML trends of 2021 - read in the blog of the company COREDO

AML trends of 2021


Just as many other sectors, finance has been immensely impacted by the pandemic. In order to reduce the financial consequences of pandemic processes and working from home, banks took action which resulted in compliance teams caring even more responsibility than before.

The financial pressure came over the compliance teams that were still stuck in the traditional technology. During the period of COVID-19, it was difficult for them to keep pace with the new developments. Resultingly, the compliance teams of this kind showed numerous delays while implementing effective customer due diligence conditions.

This situation demonstrated the need to build the strategies for 2021 strictly by using current information and a risk-based approach. While taking into account this attitude, let’s discuss the 2021 trends that are crucial for banks and other financial institutions.

More transparency with UBO laws

The overall effort for the culture of transparency also makes Ultimate Beneficial Owner laws clearer. Thanks to this transparent momentum money laundering victims can be aware of the fraud flows. The updated laws will provide clearer visibility into financial transactions. Banks, regulators, or governments could now implement better customer due-diligence checks and, therefore, reduce money laundering.

Yet not all countries are willing to implement the new concept. It is fair to say that we are about to observe tension rising between the countries that adopt UBO laws and the ones that do not. Countries that choose to decline UBO registrations, such as Switzerland, are anticipated to have growing rates of financial crimes.

2021 and AI

The pandemic obliges compliance officers to manage the remote compliance team and many other people. During these times, it is important to create a remote and cohesive digital infrastructure to pass the security and compliance conditions successfully.

Businesses must start taking necessary action steps to reconsider their compliance solutions and policies for them to respond to the company’s current needs. One of the crucial aspects is the update of the applications that would take into account the remote working.

Artificial intelligence is the answer to these updates. Even though it could probably never replace human beings, AI reduces the need for human approval and accelerates multiple aspects of AML.

Financial crimes in digitalization

Without a doubt, the global pandemic had a hugely negative impact on so many industries. However, it has actually promoted digital banking services. Meanwhile, the criminals have also been adapting to the news of the digital world.

At this moment, financial criminals are using a new method to access the financial system. They focus on virtual currencies since the interest in crypto money and other digital currencies has been significantly increasing. Accordingly, stricter restrictions need to be created for preventing money laundering in this sector. Therefore, in 2021 all financial institutions including virtual asset providers will be required to adopt KYC requirements.

COREDO offers complete AML and due diligence services to its clients. We will help you ensure the full compliance of your business with AML / KYC requirements in accordance with your local legislation.



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