Asset Management Companies

Identify reputational risks in Asset Management with PEP and sanction checks.

Background

The wealth and asset management industry is under increased regulatory observation as many stock market indices approach all-time highs, and conpanies are searching for practical ways to protect themselves against financial crime and money laundering. With the total amount of assets under management expected to rise from $110 trillion in 2020 to $145 trillion in 2025¹, regulatory scrutiny is likely to follow suit. This could include tougher penalties and fines for non-compliance, deferred prosecution agreements, and targeted management accountability for AML and sanctions violations. Asset Management Companies (AMCs) consider several factors when it comes to Anti-Money Laundering (AML) compliance:

Regulatory Requirements: AMCs must comply with AML regulations, which are designed to prevent the use of financial services for illegal activities such as money laundering, terrorist financing, and other financial crimes. AMCs must understand the AML regulations that apply to their operations and implement the necessary compliance measures.
Customer Due Diligence: AMCs must conduct proper customer due diligence to understand their clients' risk profile and ensure that they are not facilitating illegal activities. This includes verifying the identity of clients, understanding the source of their funds, and conducting regular monitoring of their transactions.
Transaction Monitoring: AMCs must monitor their clients' transactions to identify and report suspicious activities that may indicate money laundering or other financial crimes.
Suspicious Activity Reporting: AMCs must report any suspicious activities to the relevant authorities to prevent the use of their services for illegal activities.
Training and Awareness: AMCs must train their employees on AML regulations and best practices and ensure that they are aware of the signs of money laundering and other financial crimes.
Risk Management: AMCs must conduct regular assessments of their AML compliance program to identify and manage their risks of facilitating illegal activities.

Challenge

As with other financial services businesses, asset management firms are also subject to strict AML and CTF rules, but these will vary by country. Asset management and platform sectors have certain areas where the risk of money laundering, bribery, and corruption are increased. Selling investment products is one of them, especially when third parties are used to raise money. In addition, business interactions with clients, both at the time of starting a relationship with them and on an ongoing basis.

Solution

Asset management companies ought to have risk-sensitive AML policies and procedures that mandate identifying and concentrating on business relationships that pose the highest risk of money laundering. Such regulations and procedures need to be implemented successfully, receive the full support of senior management, and be communicated to the appropriate staff². Asset managers must also determine whether a customer's actions are consistent with what the company knows about that customer and their risk profile in order to maintain accurate customer due diligence (CDD) records. As transaction monitoring is typically identified as an area of weakness, effective transaction monitoring will enable asset managers to comply with law regulations and detect and report suspicious transactions³.

dilisense

dilisense can help AMCs identify relevant PEPs, as well as scan any entity against a number of sanctions, watchlists and warnings issued by regulatory agencies worldwide. Our services can be used to screen clients, suppliers, and transaction parties for sanctions as part of your internal or external sanctions screening process to help identify AML risks. To avoid human error and increase process speed and efficiency, dilisense automates PEP and sanction checks using cutting-edge technology. Using a thorough search of numerous sanction lists and official websites, asset managers, wealth and asset management companies can quickly determine the risk profiles of their customers. PEPs, prohibited people and organizations, wanted criminals on the blacklist, and sanctioned people and companies can all be found using this information. Join us today!

References

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However, some clients allow us to share their names in certain cases.
Feel free to contact us for references at sales@dilisense.com

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¹ https://www.pwc.com/jg/en/publications/asset-wealth-management-industry-to-grow-by-2025.html

² https://www.fca.org.uk/publication/thematic-reviews/tr13-09.pdf

³ https://www.mas.gov.sg/-/media/MAS-Media-Library/publications/monographs-or-information-paper/CMI1/2022/Strengthening-AML_CFT-Practices-for-External-Asset-Managers.pdf

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Asset Management Companies

Background

Challenge

Solution

dilisense

References

AML Screening API

Ongoing Monitoring

AML Database

Batch Screening

Free AML Search

AML Screening API Pricing

Ongoing Monitoring Pricing

AML Database Pricing

Batch Screening Pricing

Sanction Lists

PEP Sources

Adverse Media

Criminal Watchlists

Additional Sources

Asset Management Companies

Business & Risk Intelligence

Crypto Businesses

Financial Institutions

Gaming and Gambling Industry

Insurance Companies

Payment Service Provider

Real Estate Agencies