KYC-Chain’s Ongoing AML Monitoring Tool

KYC-Chain is excited to announce a new, cutting-edge ongoing AML monitoring feature that has been integrated with our customer onboarding platform. 

While KYC/AML checks are commonly used to screen prospective customers against AML risk factors, their risk credentials can often change after they have been onboarded. 

In simple terms, just because a customer is classified as low-risk when they are onboarded, that doesn’t mean they always will be. Individuals' and entities' risk scores can be significantly affected to changes in their activity, operations and status after they have been originally passed through a KYC onboarding process.

This added complexity means that it is critical that regulated companies carry out ongoing monitoring of their customers’ AML credentials and risk factors.

KYC-Chain’s Ongoing AML Monitoring feature is closely linked with our Risk Scoring system, and allows users of our platform to configure how often they want to carry out checks on onboarded customers for any changes in their AML risk factors. 

This allows for continuous, dynamic risk scoring, providing businesses that use our platform with a consistently accurate understanding of their customers’ risk scores. 

Regulators around the world have very clear and stringent rules regarding how Financial Institutions (FIs) and Virtual Asset Service Providers (VASPs) need to monitor their customers’ AML credentials both during an onboarding process and then after they become customers on an ongoing basis – due to the high risk of these businesses being used for money laundering and other illicit financial activity. 

This presents a major challenge for many companies – if they attempt to carry out ongoing monitoring of their customers using manual compliance teams. 

It’s already challenging enough for many businesses to carry out one-time onboarding manually, let alone to keep following up on every onboarded customer at a rate that can ensure an accurate understanding of risk scores. 

With KYC-Chain’s AML Monitoring tool, companies can quickly and easily configure their ongoing monitoring to carry out AML checks of onboarded customers at customized frequencies (daily/weekly/monthly/quarterly/annually) based on risk levels., allowing for consistent and accurate reports on customers’ risk profiles. 

How it works

KYC-Chain’s customer onboarding platform is centered around a sophisticated risk scoring system. By assessing a wide range of variables related to each prospective customer, such as their jurisdiction, type of business/source of funds, and many others, our solution assigns a risk score ranging from 0-100. 

Depending on the risk score, a customer is classified as “Low”, “Medium” or “High” risk.

The onboarding business can then choose how to process each risk category. Low risk customers can be automatically onboarded, those that are medium risk can be processed for additional screening, and high risk customers can be subjected to more stringent Enhanced Due Diligence (EDD) – or simply rejected. 

The issue is, carrying out a one-time check on customers during an onboarding process is not enough. An onboarded individual or business customer’s risk score can often shift, owing to changes in transactional behavior, ownership structure, individual status, or source of funds. 

For instance, an individual who becomes a customer of an FI may in the future be appointed to hold a position in government, or become an elected official. This would then result in them being classified as a Politically Exposed Person (PEP) – which places them in a higher risk category when it comes to AML. 

Similarly, an onboarded business may suddenly change its place of business to a sanctioned jurisdiction, or be placed on an international watchlist as a result of suspect financial activity. 

The challenge for companies is keeping track of all these potential changes, which grow exponentially with every new customer they take on. 

KYC-Chain’s Ongoing AML Monitoring tool solves this challenge by allowing the workflow manager to configure how often to run screening checks against onboarded parties based on a customer’s risk level. 

For example, Low risk profiles can be assigned screening that takes place every 3 months, in order to assess whether any notable changes to their risk factors have altered their risk profile. For Medium risk profiles, checks can be automatically scheduled to take place monthly, and for High risk profiles, the checks can even be configured to take place daily. 

Any changes to an onboarded party’s risk factors and profile are collated into an automated report that is sent to your human compliance team for review.

Like all of our KYC solutions, our Ongoing AML Monitoring tool is designed to make compliance fast, simple and efficient for companies and organizations of all sizes. 

Are you looking for a way to easily stay up to date on your customers’ risk profiles? Get in touch and we can tell you more about our market-leading KYC, AML and compliance solutions.