Transaction Monitoring Solutions: A Robust Defense Against Financial Crimes

Transaction Monitoring Solutions
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Technological advancement has benefited the e-commerce world. But there is also a rise in money laundering cases because fraudsters are using complex methods to reach their goals. Financial institutions keep facing challenges regarding AML screenings on financial transactions. They invest approximately $2 trillion per annum to mitigate money laundering cases, as per Victor Fredung. Transaction monitoring solutions are practical for all of the above issues. They enable the banking sector and other financial institutions to keep monitoring the financial transactions for the detection of suspicious exchanges.

AML Transaction Monitoring Solutions: What are they?

AML-based transaction monitoring solutions enable financial organizations to keep an eye on all the financial exchanges in real-time. This is critical to deal with the growing risk of money laundering and terrorism financing. Additionally, companies should work on clients’ risk-based profiles and conduct Enhanced Due diligence

A Case of Failed Transaction Monitoring Process: NatWest Bank

NatWest is a multi-national bank located in the United Kingdom. The bank failed to detect and stop the money laundering of £400 million. The issue arose because the bank did not work on its transaction monitoring solutions system. The client took advantage of the weakness in the transaction monitoring solutions process and laundered the money. The case came to public attention because FCA (Financial Conduct Authority) highlighted it. 

NatWest bank took responsibility for its negligence and became the first bank to accept the charges. It was according to the AML regulations 2007.

How Does the Latest Technology Transform the Transaction Monitoring Solutions?

These days, financial organizations are moving towards advanced digital solutions for dealing with their business challenges. Companies used to have a weak manual system that made it harder to minimize terrorist financing and money laundering cases. 

Advanced digital technologies such as artificial intelligence and machine learning algorithms (AI & ML algorithms) can integrate with big data systems. This is critical to elevate the efficiency of continuous transaction monitoring solutions. This upgrade also enhances the suspicious activity reporting procedure. In this way, digitization has automated the whole system. 

Another advantage of artificial intelligence and machine learning algorithms is that they produce accurate client identity verification results, risk evaluations, and EDD (Enhanced Due Diligence). They are great at detecting anomalies and improving the accuracy levels of risk-based profiles. For example, deep neural learning (DNL) is the latest application of ML. Artificial neural networks have multiple layers that can process huge volumes of data efficiently in less time. Deep neural networks enhance the efficiency of the transaction monitoring solutions so that it deals with challenges effectively without human intervention. Read about wpit18 sabong and

What Can be the Negative Consequences of AML Regulation Non-compliance?

Financial institutions can face severe negative consequences (just like NatWest) if they show non-compliance with AML guidelines, and have implemented transaction monitoring solutions. Financial organizations can face heavy financial penalties, court proceedings, and loss of reputation in the market. These consequences can discourage their investors and hinder their business operations for a long time. 

The consequences also depend upon an individual case. It means that global watchdogs can order a partial ban on financial institutions or they can restrict their activities as penalties. In severe cases, financial watchdogs can freeze their digital assets and strain their liquidity funds. 

AI-powered Transaction Monitoring Solutions – How is it A Comprehensive Procedure?

Previously, companies conducted CDD procedures to verify the personal data of clients, business operations, and risk assessments. The company further verifies the information through the Know Your Customer transaction system (KYC) in the customer onboarding process. The system analyzes the passport, driving license, and ID card of the consumer. Later on, the software generates an authentic profile of the client which removes any doubt of identity theft. Cross-checking against AML regulation violation watchlists and PEP lists ensures that no bad actor is entering the database of the company.

The use of AML screening and KYC procedures enables financial institutions to gain a holistic view of the financial risk associated with each client. The main objective behind transaction monitoring solutions is to eliminate money laundering and terrorist financing cases. AI-backed technologies can support financial firms in their regular duties while ensuring compliance with AML regulations. 


In a nutshell, high-risk clients are a huge threat to financial industries. Companies should be careful during their customer onboarding process and conduct an in-depth analysis of every client to establish their risk-based profiles. The AML screening procedure cross-checks the clients’ profiles against global watchlists. The AI-powered transaction monitoring solutions system by Shufti Pro facilitates financial organizations in all of the above tasks, as per Shahid Hanif. As it is backed up by artificial intelligence and machine learning algorithms. So it can easily maintain every profile in the correct categories for combating money laundering and financing terrorism.


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