Financial crime is becoming exponentially harder to combat, yet outdated Anti-Money Laundering (AML) controls continue to hinder progress. Despite financial institutions investing billions in compliance, AML fines and penalties remain at record highs. The recent $3 billion fine imposed on TD Bank for AML failures highlights a growing problem: financial crime prevention is reactive rather than proactive, and traditional compliance methods are no longer effective.
Fragmented AML Regulation and Compliance Gaps
AML regulations remain inconsistent across jurisdictions, making cross-border money laundering prevention challenging. While the Financial Action Task Force (FATF) sets global standards, enforcement varies, leaving gaps that criminals exploit. Legacy Know Your Business (KYB) and Know Your Customer (KYC) identity verification methods must evolve into real-time, data-driven compliance frameworks to improve risk management and fraud prevention.
The High Cost of Manual Compliance
Reliance on manual processes strains compliance teams, with 98% of EMEA financial institutions reporting rising financial crime compliance costs and 81% prioritizing cost reduction. However, cutting costs without enhancing efficiency leads to vulnerabilities. Automating Suspicious Activity Reports (SARs), transaction monitoring, and AI-driven risk assessments transforms compliance into a strategic advantage.
RegTech: The Key to Smarter Compliance
Adopting regulatory technology (RegTech) solutions—such as AI-driven AML compliance, digital identity verification, and real-time fraud detection—helps financial institutions streamline operations and strengthen security. Investing in AI-powered risk analysis and data literacy training allows compliance teams to shift from reactive, penalty-driven approaches to proactive financial crime prevention.
Don’t let outdated compliance processes put your business at risk.
Baselayer provides the tools and technology needed to enhance AML compliance, streamline KYB identity verification, and stay ahead of financial criminals. Contact us today to learn how our innovative solutions can help your organization strengthen its compliance framework and drive operational efficiency.