Companies need to make accurate risk management against the extraordinary processes they are in. Especially in the recession period experienced nowadays, many organizations have resorted to reducing their expenditures, restricting the budget, and reducing employees' number. However, these methods may not work for every department.
An organization that fails to manage risk may not show the necessary resistance to any money laundering and terrorist financing activity. It also prepares the ground for many criminal sanctions. That's why having the right compliance program is essential for managing your company's risk. So what are the risks awaiting companies in 2021? Why should companies increase their compliance budgets in the new period? How should you determine the most suitable compliance program for your company? Let's talk about them a little bit.
What is AML Compliance?
Compliance is the rules that a company sets for its employees and the behavior rules in the workplace environment. It includes companies' written and verbal values, employee guidance, policies created to comply with legal obligations, and more. Compliance may vary act on the needs and potentials of large and small organizations. For example, it may include a general advisory office in large organizations or may include a compliance officer. Whereas in smaller organizations, compliance may be executive board, human resources(HR), or finance manager activities. However, each organization must comply with AML / CTF laws and regulations established by national and international organizations.
In other words, for organizations, compliance means operating in line with laws and regulations. An organization is responsible for all policies, rules, and controls that are determined for them. Companies that do not comply with the rules may expose to various criminal sanctions. Also, a weak compliance program will not do well for your company's prestige.
What are The AML Compliance Challenges in 2021?
We mentioned that if the regulations against AML / CTF risks waiting for companies are not followed in 2020, the severity of the sanctions and penalties increased. Therefore, it has become more critical for companies to have an AML compliance solution in the past period. Also, In 2021, it is expected that the pandemic period will continue for a while. Therefore, companies should focus on compliance processes in the upcoming period.
On the other hand, Britain's decision to exit the EU and implement the Brexit agreement is one of the most important factors that change the economy's course. The most crucial point in the deal is that it does not explicitly discuss equivalence issues in financial services. There are several reactions and criticisms against the UK's decision to leave the EU. Despite all this, the UK signed the Brexit agreement led to the EU imposing sanctions and obligations on the UK. Undoubtedly, finance companies were the most affected by these liabilities. The EU's attitude towards the UK and its compliance process with the Brexit agreement made the fate of financial services companies uncertain.
6AMLD is the new EU Money Laundering Directive, which will take effect as of June 2021. With 6AMLD, companies will adopt several new regulations. Also, 6AMLD contains more serious responsibilities and penal sanctions than 4 and 5 AMLD. Therefore, It is significant that institutions must be more cautious about complying with new regulations.
Why is AML Compliance Important?
As we all know, the world economy has been struggling with a critical problem for a while. COVID-19 has affected many areas, especially in health, technological, social, and economic areas. With the spread of the virus all over the world, several local and global sectors were damaged. The world economy has been experiencing the most painful period in recent years.
In addition to this, institutional scandals that occurred due to various reasons brought along new regulations that organizations had to comply with. Non-compliance may incur unavoidable risks and devastating business consequences. Considering all these, the criminal sanctions and reputational losses incurred due to institutional scandals reveal the importance of a better compliance solution.
Maintaining your organization's compliance efforts with manual tools may be less costly in the short term. However, when we consider your company's need to comply with AML regulations that are updated annually, it is not difficult to understand how large the costs of manual compliance efforts are in the long term. So it's not unreasonable to seek help from an AI-powered AML compliance program.
Sanction Scanner AML Compliance Solutions for Companies
Global risks and institutional scandals have caused severe financial and moral damage to various institutions. That's why more and more companies have been focusing and investing in vital compliance programs. A strong compliance program not only protects companies from criminal sanctions and loss of reputation but also identifies the risk areas of businesses and creates compliance solutions without unnecessary constraints.
Sanction Scanner, an AML compliance solution, helps businesses comply with national and international AML regulations. Companies can also take early measures against any risk of money laundering, fraud and terrorist financing through the global and up-to-date AML data such as sanction lists, PEP lists, watch lists, and wanted lists collected by Sanction Scanner from more than 200 countries.
With Sanction Scanner's powerful search algorithms supported by artificial intelligence, you can perform AML checks of your company safely within seconds. On the one hand, Sanction Scanner has a powerful API that can be easily integrated. Thus, it can work efficiently on mobile screens. Through Sanction Scanner, you can always use real-time data wherever you want.
