Autonomous AML program starts with Know Your Customer (KYC) / Customer Due Diligence (CDD)

Lower the Cost of Compliance with the Next-Generation KYC/CDD Solution. Today’s Financial Service Organizations (FSOs) are realizing a succesful and cost-efficient AML programs must begin with an effective Know Your Customer (KYC) / Customer Due Diligence (CDD) process. Weak or degraded proccesses will have compounding effects on the downstream AML functions. Learn how intelligent automation, AI and machine learning, combined with KYC/CDD domain expertise, will reduce costs, create operational efficiencies, and provide a holistic view of customer risk.

Autonomous AML program starts with Know Your Customer (KYC) / Customer Due Diligence (CDD). Source: NICE Actimize
Autonomous AML program starts with Know Your Customer (KYC) / Customer Due Diligence (CDD). Source: NICE Actimize

Processes for Know Your Customer (KYC) / Customer Due Diligence (CDD) are steadily taking a large bite out of overall Anti-Money Laundering program costs – 60% of the total spend, to be exact. As the AML regulatory landscape evolves and the bad actors become more sophisticated, compliance teams need a solid AML program that meets these changing requirements, while curbing costs.

Is your KYC/CDD proccess strong enough to prevent overall AML program deficiencies in the future? Find out in the NICE Actimize CDD-X article to learn how to take back your money and your time, starting with a strong KYC/CDD to prevent overall AML program deficiencies in the future.

In this article, you’ll learn how:

  • CDD-X complements transaction monitoring with better client risk attributes and enables integrated watch list filtering to screen and risk score all related parties.
  • Using technology advancements instead of more people will help managers strike the right balance of headcount and Financial Crime & Compliance Management (FCCM).
  • Intelligent automation, AI and machine learning, combined with KYC/CDD domain expertise, create operational efficiencies and a holistic view of customer risk relationships

Content Summary

The growing cost of compliance is not sustainable
A strong KYC/CDD prevents overall AML program deficiencies in the future
Supercharge customer profiles for improved customer risk scores
Reduce overall AML risk

The growing cost of compliance is not sustainable

Over the past few years, the cost of compliance has been skyrocketing and Financial Service Organizations (FSOs) are depleting their resources to keep up with the volume of transactions resulting from more sophisticated schemes.

Meeting the demands of today’s regulatory environment is especially challenging where customer due diligence processes are manual, inconsistent and provide an incomplete view of the customer and the risks they pose. High costs are incurred from the complexity of on-boarding customers, data acquisition and aggregation and high-risk customer management. Inadequate controls and manual processes can lead to increased regulatory scrutiny, reputational risk and potential financial penalties – all while damaging customer satisfaction.

When it comes to financial crime risk management, many organizations are trying to achieve a unified approach, but it seems like a daunting task.

In most cases, the instinct is to increase headcount, but that isn’t the answer. So, what is? Using technology advancements instead of more people will help managers strike the right balance of headcount and Financial Crime & Compliance Management (FCCM). FSOs need an agile partner with purpose-built systems for FCCM.

KYC/CDD processes 60% consume nearly of the total costs spent on overall AML programs.

A strong KYC/CDD prevents overall AML program deficiencies in the future

Continuing on the journey to Autonomous AML, NICE Actimize CDD-X uses the latest technological innovations to expand risk reach. Intelligent automation, AI and machine learning, combined with KYC/CDD domain expertise, create operational efciencies and a holistic view of customer risk. This gives FSOs a complete understanding of their customer relationships.

Key benefits

Entity Insights: Introducing Entity Insights, a new state of the art capability that automates investigations into meaningful, entity centric visual stories – enhancing the efficiency of investigators. The graphical representations of the relationships between entities and alerts, and the additional supporting data that’s displayed in different widgets within the Entity Insights™ display allow for more risk to be uncovered, and for faster and more accurate decisions to be made.

Intelligent Automation: Financial crime investigations and compliance operations are transformed by the deployment of a virtual workforce. This pre-built library of purpose-built “robots” is made specifically for Financial Crime & Compliance environments. These “robots” imitate investigative activities such as data collection and reporting, while collaborating with human investigators, saving time and allowing a shift in focus to higher value tasks.

Simulation: As a customer’s risk profile changes over time, FSOs need a way to know if changes to system settings is for the better. The simulation feature takes the guesswork out of adjusting risk policy settings so FSOs can better assess the impact of updates on their Simulation customer population and business operations.

  • Test changes to settings before going live
  • Understand impact of risk policy changes on business relationships with intuitive dashboards and reports
  • Forecast staffing needs accurately
  • Lower maintenance costs with a process done on top of the production environment, eliminating the need for test environments, third party application licenses, hardware and software updates

Supercharge customer profiles for improved customer risk scores

CDD-X optimizes customer risk scores leveraging cloud-based analytics and data-driven machine learning. This means better identification of high-risk customers who were previously misclassified with a lower rating, and reclassifying customers incorrectly marked as high-risk. This usage of the score increases the accurate risk classification of customers so enhanced due diligence (EDD) controls are applied to the right customers. These improved insights enable better customer relationships with a lot less friction.

In a survey conducted by NICE Actimize on expected budget for KYC/CDD, over half of respondents indicated their budget would be the same or less than today in the next 12-18 months. The same respondents said if they were to increase spending at all, it would be for automation through new technologies.

Reduce overall AML risk

As a core component in the Autonomous AML portfolio, CDD-X enhances the overall KYC-AML program. It complements transaction monitoring with better client risk attributes and enables integrated watch list filtering to screen and risk score all related parties. It’s also packaged with NICE Actimize ActOne case management, which gives a single output of consolidated, correlated and centralized data, to provide actionable intelligence to manage workflows, support investigations and ensure oversight.

CDD-X helps you to be more confident in managing your customer risk. Having a holistic, modernized, integrated set of solutions provides FSOs business agility and cost savings in the fight against financial crime.

Source: NICE Actimize