This survey brings together insight from Anti-money laundering (AML) Transaction Monitoring (TM) professionals across EMEIA financial institutions.
The survey shares representation from France, Switzerland, the Nordics, UK and MENAT. The respondents believe they are progressing towards effective and efficient automated monitoring. They understand challenges such as rules-based monitoring and the subsequent high-volume investigations, is not an effective way to manage financial crime risk. Increased focus on the use and application of advanced analytical approaches is necessary to drive improvements.
- Low SAR filing rates remain prevalent with considerable sector variations
Conversion rates of alerts to Suspicious Activity Reports (SARs) has not improved since 2014. What also emerges is an increasing difference between sectors like Retail Banking and Corporate and Markets sectors. Retail banking on the whole has effective, although inefficient, TM systems compared to the largely ineffective TM systems of the Corporate and Markets sectors. It is common in the Markets sector to have no alerts from a TM system that result in a SAR filing for an entire year. There is a growing view that a fundamentally different approach is needed.
- Institutions are more methodical in their approach to detection
Compared to 2014, there is now a developing consensus on the standards to be achieved. While there is still variation across organizations, there is now much more methodology underpinning most TM system configurations and TM operations.
- Maturity varies across institutions, largely due to regulatory scrutiny and levels of investment
While most organizations have matured, there is a growing gap between multinational banks who have experienced direct regulatory scrutiny and invested heavily as a result, and the regional retail banks who are more focused on getting the basics right.
- Low satisfaction of TM across financial institutions
Overall satisfaction with TM has not improved since the 2014 survey. Despite the investment and the improved maturity, the targets have moved: expectations, both internally and externally, are now higher.