Anti Money Laundering (AML) / Know Your Customer (KYC)

See below for a list of independently written IBS Journal news and feature articles and IBS Intelligence Research vendor profiles, case studies and market analysis related to Anti Money Laundering/Know Your Customer in order of publication date.

We cover AML/KYC regularly in our flagship IBS Journal. Click here for more information and to subscribe online >>

Anti-money laundering (AML) consists of a set of procedures and checks that are designed to detect and prevent money from illegal sources entering the legitimate financial system. The concept of money laundering is to cleanse money obtained from illegal activities and disguise its origins so that it is accepted by the financial community. The concept of anti-money laundering is to prevent that activity taking place.

The original anti-money laundering practices were intended to curtail the proceeds of crime – particularly organised crime – and were introduced in the early 1980s. However, anti-money laundering practices gained additional momentum following the 9/11 terrorist activities.

The ways of detecting money laundering activities generally fall into two categories – detecting suspicious activity and detecting activity of suspicious persons. One way of detecting suspicious activity is by comparing the activity of a given account or customer against the typical activity of its peer groups. Other methods include identifying large cash deposits, or multiple or repetitive deposits that are just under a reporting threshold, unusual money transfer activity, purchase or sale of unusual amounts of cash equivalents such as travellers cheques and the like. Detection of activity by suspicious persons is normally achieved through the Know Your Customer (KYC) directives. The identification provided by the customer is checked against various governmental sanctions lists that contain the names of politically exposed persons (PEP) or other ‘blacklisted’ persons or bodies. These lists, which include national lists as well as international lists such as the UN list, are sometimes referred to generically as OFAC lists after the Office of Foreign Asset Control in the US Government which produced one of the original lists.

See also the IBS Journal Financial Crime and Anti-Money Laundering Supplement 2012 >>

It is now recognised that anti-money laundering practices and procedures are different to those of anti-terrorist financing. It is now recognised that they are two are separate activities.

There are specialist systems available that help banks in detecting suspicious activity. Some of these systems use artificial intelligence to monitor account activity while others use a rules-based approach.

When suspicious activity is recognised, the system will generate an exception notice that is sent to the bank’s anti-money laundering officer (AMLO) for examination. If it is warranted then the AMLO will notify the appropriate governmental organisation using a suspicious activity report (SAR).

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KYC is the acronym for Know Your Customer, which in turn refers to the obligation of a financial institution to know its customers and know who it is dealing with. The KYC requirements are part of the anti-money laundering and anti-terrorist financing measures.

A financial institution is required to obtain proof of identity of its customers, especially new customers opening accounts. The customer names and addresses are then to be compared to sanctions lists of suspicious or designated persons that are regularly produced by government agencies. Sometimes these lists are referred to generically as OFAC lists after one of the original lists that was produced by the Office of Foreign Assets Control of the US government.

Many modern computer systems will have some form of system-based check-list that verifies that all relevant documents have been received and notes any documents or proof of identity checks that may be outstanding. Normally financial activity into or out of the associated accounts for that customer will not be allowed until the KYC checks are complete.

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Article: Case study: Soneri Bank – One step ahead

02 May 2013

With financial crimes growing daily, banks are under increased regulatory scrutiny to ensure proper policies, controls and procedures are in place. IBS speaks to Soneri Bank in Pakistan about how strong its prevention of money laundering is and how...

Article: Project watch: Legal Entity Identifier – Safety in numbers

02 May 2013

The global roll-out of a Legal Entity Identifier (LEI) is slowly but surely turning into a reality. The international infrastructure is taking shape, and concerted efforts to distribute LEIs are now well underway. IBS speaks to industry experts...

Article: IBS Journal Anti-Money Laundering Supplement 2013

02 May 2013

New ways of defrauding and money laundering, new ways of preventing it, new sanctions and regulations – these subjects crop up again and again. And although the industry talks the talk, actions of some of the participants don't support their s...

Article: Overview: Keeping up

02 May 2013

AML and fraud software has become a 'top management issue' for banks in recent years. IBS looks at why this is, and whether software is standing up to the tests of financial criminals.

Article: Spotlight: Sanctions Screening – One year on

02 May 2013

Swift's Sanctions Screening service is now one year old. Has it been all that Swift hoped for, and what other developments are in the pipeline?

Article: Swift – Alliance Messaging Hub (AMH)

01 May 2013

Contents: Overview / Strengths / Corporate Overview / Summary History / Product Suite / AMH under Sungard / AMH under Swift / Functionality / Uptake and Customer Experiences / User List.

Article: ACE Software Solutions Inc – Pelican

23 April 2013

Contents: Corporate Overview / Strengths / Weaknesses / History / Overview / Product Suite / Uptake and Customer Experiences / User List

Article: Who's Bought What? – April 2013

04 April 2013

A round-up of recent orders in the financial technology sector worldwide. New deals for NICE Actimize, Smartstream Technologies and Alaric.

Article: Bank Central Asia automates AML processes with NICE Actimize

25 March 2013

Bank Central Asia (BCA) has become an early adopter of fully automated anti-money laundering (AML) software in Indonesia and the wider region. The bank is replacing its legacy, largely manual system with the Actimize AML Suspicious Activity Monitoring...

Article: IBS Journal Forward Features 2013

21 December 2012

View the forthcoming IBS Journal Supplements and special focus issues scheduled for 2013 and download our latest Media Pack featuring readership and distribution details, plus online and print advertising opportunities across our extensive range of...

Article: End of Year Review 2012

20 December 2012

As 2012 drew to a close, IBS Journal rounded up the significant developments of the international banking software industry, highlighting major achievements, dubious accomplishments, key mergers and acquisitions, as well as regulatory changes that...

Article: CGI – Logica All Payments Solutions

10 September 2012

Contents: Overview / Strengths / Weaknesses / Corporate Overview / History / Product suite / Functionality / Uptake and Customer Experiences / User ListThis supplier is also profiled in the following IBS Intelligence research...

Article: Compass Plus – Tranzware Suite

10 September 2012

Contents: Overview / Strengths / Weaknesses / Summary History / Product Suite / Uptake and Customer Experiences / User List.

Article: Top Systems to provide AML offering to Banco Regional

07 September 2012

Having been recently acquired by Stefanini Group in Brazil, Top Systems will roll out its anti-money laundering solution in Banco Regional, Paraguay-based bank, by the end of this year. The vendor is also involved in an on-going project with a...

Article: TCS targets US banking sector with Bancs on a hosted basis

26 July 2012

India-based TCS Financial Solutions hopes to crack the US banking market with an ASP offering of its core banking system, Bancs. For this it has partnered with managed IT and services provider Savvis. One taker has just been signed.

Article: Top Systems, core banking vendor in Latin America, acquired by Stefanini Group

21 June 2012

Uruguay-based Top Systems, developer of the Topaz Banking core system, has joined Stefanini Group. Topaz will continue to be developed and marketed, and will gain the option of an ASP deployment. The mid-tier Latin and Central American banking sector...

Article: IBS Journal Financial Crime & Anti-Money Laundering Supplement 2012

02 May 2012

Is the IRS going to change its name? This is the question nobody is asking as the world financial industry comes to terms with the Foreign Account Tax Compliance Act (FATCA) which specifically targets assets held outside US soil.

Article: Product launch: Swift – Screen test

02 May 2012

The Swift Sanctions Screening service went live on 16th April 2012, and promises 'on the fly screening of Swift messages'. The offering has been in genesis for a couple of years. IBS talks to Swift's head of AML and sanctions about it.

Article: Analysis: FATCA – The long arm of the IRS

02 May 2012

New guidance from the Internal Revenue Service in February 2012 put further meat on the bones of the Foreign Account Tax Compliance Act, designed to tax assets held overseas by US citizens.

Article: Analysis: Sanctions – Another fine mess

02 May 2012

There are a couple of ways of putting the issue of sanctions in perspective. One is to consider the enormity of the fines levied against banks found in contravention by US authorities, specifically the Office for Foreign Asset Control (OFAC), which...

Article: Case study: Bermuda Commercial Bank – Sun block

02 May 2012

Is the island of Bermuda strong on prevention of money laundering? Horst Finkbeiner, COO of Bermuda Commercial Bank puts its case to IBS: 'I know the other banks work really hard at keeping the money launderers out, but it is a constantly shifting...

Article: On the move – May 2012

02 May 2012

A round up of recent appointments and departures within the industry. Departures at Temenos and Paypal. FIS, TCS and Fiserv are among the companies who have announced new hires.

Article: PSB Bank in IT overhaul

02 May 2012

Curacao-based PSB Bank, a government owned outfit which until recently focused on savings and loans, has taken Fiserv's Signature core banking platform plus its Aperio channel integration solution.

Article: IBS Journal Middle East Supplement 2012

04 April 2012

In business as in life, those who take the risks reap the rewards. IBS looks at some of the pressing issues in the Middle East region and asks how the financial services industry is, or should be, handling them.

Article: Analysis: Credit risk – Credit where it's due

04 April 2012

The approach to credit risk management in the Middle East has been changing in recent times. What's going on and why?

Article: Analysis: Financial crime – Joining the dots

04 April 2012

Data is the best shield against crime. Are banks prepared?

Article: Analysis: Sanctions lists – What's in a name?

04 April 2012

Monitoring sanctions lists should be a serious business for financial institutions. But it is not an easy task...

Article: Case study: British Arab Commercial Bank – Some like it hot

04 April 2012

For British Arab Commercial Bank, dealing with the politically sensitive is its stock in trade. Technology plays a major part of its day-to-day activity.  

Article: OpenWay – Way4

30 March 2012

Contents: Overview / The Product Suite / Partnerships / Uptake and Customer Experiences / User List 

Article: Finacle roll-out gets fresh lease of life at Uralsib

28 March 2012

A lengthy (seven years to date) core banking implementation project at one of Russia's largest banks, Uralsib, finally might be heading for completion, with yet another new team and CIO.

Article: Interview: John Turner, Xceed Group – Work to rule

07 March 2012

Does an industry that has its focus on risk management and stability have any room for growth? It does if it puts the effort in. IBS talks to industry consultant, John Turner.

Article: BMO Capital Markets standardises customer on-boarding with Polaris

02 December 2011

BMO Capital Markets, the wholesale banking arm of Canada-based BMO Financial Group, is rolling out Polaris' Customer On-boarding Hub for its operations.

Article: FIS – Connex, IST/Switch, Data Navigator, IST/Clearing, IST/MAS, Fraud Navigator, Liability Manager, EnterpriseView, Cortex, CSF

02 November 2011

Contents: Overview / Strengths / Weaknesses / Corporate Overview / History / Product suite / Strategy / Uptake and Customer Experiences / User ListThis supplier is also profiled in the following IBS Intelligence research publi...

Article: Eurofinance 2011: Think about the future

28 October 2011

Eurofinance's 20th anniversary international cash and treasury management event did not want to dwell on the past but instead looked forward to what might be. Technology will be at the forefront of the treasury role. Probably.

Article: Ultradata releases fraud solution for local market

30 June 2011

Ultradata Australia has announced the release of its Fraud Interceptor solution.

Article: Polaris Financial Technology – Intellect Payments, Intellect Cards

27 May 2011

Contents: Overview / Strengths / Weaknesses / Corporate Overview / History / Product suite / Strategy / Uptake and Customer Experiences / User ListThis supplier is also profiled in the following IBS Intelligence research p...

Article: Oracle FSS – Flexcube Payments

27 May 2011

Contents: Overview / Strengths /Weaknesses / Corporate Overview / History / Product Suite / Strategy / Uptake and Customer Experiences / User List This supplier is also profiled in the following IBS Intelligence research pu...

Article: Experian – Bank Wizard, Experian Payments Gateway

27 May 2011

Contents: Overview / Strengths / Weaknesses / History / Product Suite / Partnerships / Uptake and Customer Experiences / User List

Article: Interview: Nick Levy, consultant

25 May 2011

The retail lending industry is ripe for change says Nick Levy, managing principal with financial services consultancy, Capco. Does the traditional banking industry know what's about to hit it?

Article: Case study: Turkish Bank UK

25 May 2011

When Turkish Bank's UK subsidiary wanted to enhance its lending services to the SME community it dropped the group in-house system in favour of Temenos' T24.

Article: Swift selects Sword Fircosoft for sanctions screening service

10 May 2011

Swift is aiming for low-end banks with its planned centralised sanctions screening service and has selected a solution from Sword Fircosoft to support this. The service, which will compete with existing solutions, is due to be available by the end of...

Article: Interview: Dr Tony Wicks, AML specialist – The name game

28 March 2011

Concern over the movement of funds by certain Middle East leaders has shone a light on financial intelligence processes. What are the challenges and are the banks prepared?

Article: Who's Bought Who? IBS Journal March 2011

03 March 2011

A round-up of recent mergers and acquisitions in the financial technology sector worldwide. Buyers include Sungard, Bottomline Technologies, Visa and FIS Global. Direct Debit Limited (DDL), Chi-X Europe and Playspan are among the target companies.

Article: Who's Bought Who? IBS Journal February 2011

02 February 2011

A round-up of recent mergers and acquisitions in the financial technology sector worldwide. Buyers include Capgemini, BAE Systems, SAP and Wall Street Systems. Norkom Technologies, Ecofinance and Cardsave are among the target companies.

Article: Uralsib Bank first in Russia to take 3i Infotech's AML system

25 November 2010

One of Russia's largest banks, Uralsib, is implementing an anti-money laundering (AML) system from 3i Infotech. This is the Indian vendor's first AML project in Russia. The go-live is scheduled for February 2011.

Article: FIBI Bank live with Infrasoft's OmniEnterprise AML solution

26 October 2010

FIBI Bank (UK), a subsidiary of First International Bank of Israel, is live with a new anti-money laundering (AML) solution from Infrasoft, the India-based software vendor.

Article: Who's Bought What? – October 2010

30 September 2010

A round-up of recent orders in the financial technology sector worldwide. SAS, FRSGlobal, Sofgen, Fidessa, Norkom and others have announced new deals. Central Bank of Oman, Russia's VTB Bank, UAE's National Bank of Abu Dhabi and US-based EFX Corp...

Article: AML software vendor Norkom secures deal with Russia's number two bank

23 September 2010

Ireland-based anti-money laundering (AML) software vendor, Norkom Technologies, has secured its first win at a domestic bank in Russia, VTB Bank. The large-scale deal will cover VTB's trade finance and correspondent banking operations across the...

Article: Jamii Bora Trust: It's a family affair

20 August 2010

For Kenya-based MFI, Jamii Bora Trust, rapid growth brought a need for automation and reach. The latter stemmed from mobile communication with the back office combined with biometrics.

Article: Biometrics for microfinance: Body talk

20 August 2010

As any villain, nuclear bunker worker or James Bond fan may attest, biometrics is a system that uses uniquely identifiable physical or behavioural human characteristics as a form of identity, access management and surveillance. In this article we...