Transparent and effective detection of financial crime is a reality. KPMG firms are disrupting and transforming the future of transaction monitoring.
The current challenge for banks is a combination of ever increasing and evolving regulations and legislation creating a complex regulatory environment in which to operate and comply with. Getting compliance wrong is not an option.
The tuning of Transaction Monitoring (“TM”) systems is a complex task, intensified by heightened expectations from regulators. Financial Institutions often perform tuning on a periodic basis, relying on simplistic 'above and below the line' testing. Inefficient systems result in the production of large volumes of alerts. Worldwide banks manually review millions of financial crime monitoring alerts per month with almost 95% of the alerts raised being 'non-suspicious'. Current alert review processes frequently rely on extensive teams of personnel, often spread over disparate geographical locations. Many compliance professionals interviewed expected to see further increases in headcount this year to maintain their current levels of compliance.
In the face of increasing and evolving regulation, increasing transactional volumes, and the identification of new money laundering typologies, KPMG has developed solutions that target both systems optimization and alert review processes. The goal is an increase in quality of monitoring systems performance and faster, more accurate and consistent alert review, helping Financial Institutions to meet their TM obligations with increased quality and at reduced cost.
Ongoing review and refinement of TM systems can result in production of lower volumes of better quality alerts that can be reviewed more easily, whether by humans or use of the TM alert classifier.
The TM alert classifier automates alert review decision making at the first level of review.
Management information and analytics provides insight into system performance, data quality and additional insights that can inform financial crime controls.
KPMG has combined expertise in Financial Services, Transaction Monitoring and technology with world class Data Science professionals to create advanced technology solutions for Transaction Monitoring systems. Experience of working with clients around the globe has helped ensure KPMG technology solutions develop at pace to reflect regulator appetite while addressing client challenges.
The responsibility rests with companies themselves to prove they have an effective, extensive and efficient means of managing third party risk.
Third party risk management is an opportunity that we must embrace.