Financial Institutions

AML (Anti-Money Laundering) screening is crucial for Financial Institutions like banks, challenger banks and credit unions because it helps them to comply with regulations and prevent financial crimes such as money laundering, terrorist financing, and other illicit activities. AML screening involves the use of advanced technology and processes to identify and verify the identity of customers, assess their risk level, monitor their financial transactions, and report any suspicious activities to the relevant authorities. This helps Financial Institutions to detect and prevent any illegal financial activities that may be taking place, as well as protect their reputation and credibility. Failing to comply with AML regulations can result in severe consequences for Financial Institutions, including substantial fines, legal action, and reputational damage. Therefore, implementing effective AML screening processes is not only a legal obligation but also a critical component of risk management for banks and other financial institutions.

It is estimated that 2–5% of the world's GDP, or $800 billion–$2 trillion in current US dollars, is laundered internationally each year. However, it is challenging to assess the overall quantity of money that undergoes the laundering cycle due to the covert nature of the practise¹. A recent investigation in the UK additionally showed that political donations and donations to charities typically tend to escape money laundering checks, despite the requirements to demonstrate that the received money has not been laundered².