For quite some time now the financial sector has had to suffer because of financial crimes. Money laundering is one of the major challenges and in order to respond to this threat, banks and other players in the financial sector have developed an array of anti money laundering solutions designed to detect and prevent the vice. Transaction monitoring and surveillance has been a major step forward. There are advanced transaction systems that simply give banks the power to prevent money laundering in a more proactive way. But how do these monitoring and surveillance systems work? Well, here is a simple explanation.
Aml Surveillance Definition
Before giving you a breakdown of how surveillance systems in anti money laundering work, first of all let’s introduce you to the concept of aml surveillance. Well, simply out, aml surveillance is the process through which banks monitor transactions going in and out of their system. The aim is to see whether the transactions are aligned to the expected pattern. In cases where a transaction goes out of order, it will be flagged and reported for further investigation.
How Does Aml Surveillance Work?
On face value aml surveillance may seem like a challenge. However, there is enough technology to deliver results without affecting the overall efficiency of the banking system. Here is how it works:
Customer Behavioral Pattern
A monitoring surveillance system will flag a transaction based on a set criteria. It is the job of the bank to set these criteria. As part of the process, banks will collect information about a customer and create a transaction pattern that is to be expected from that particular customer. Every transaction done by the client using the bank’s system will be monitored by the system to ensure the expected pattern is not breached.
If there is a case where a transaction fails to align itself with the customer profile or pattern, the system will flag and report it. This is where it gets interesting. Just because a transaction is flagged does not mean it’s bad, it only indicates that more investigation needs to be done. There are systems though that have very few false positives and most of the time, only suspicious transactions will be flagged. In addition to this, it is important for banks to do well in developing quality customer profiles and behavioral patterns to ensure they are not missing anything.
Well, that’s it! Transaction monitoring is not rocket science and as long as you have a quality aml surveillance system, it will be so easy. You can visit Trapets and discuss your options. They provides high quality transaction monitoring solutions in the financial sector.