Mar 18 - Advanced anti-money laundering technologies can reduce the operational cost for AML programs in banks and other financial institutions by up to 40%, a new white paper from risk and compliance specialist Fortent reveals. For financial firms who adopt this technology, these savings translate directly into a higher return on systems investment – an area of top concern for the C-suite.
While systems cost is often perceived to be the big budget item in AML compliance programs – programs that cost billions annually for the U.S. financial sector alone – it is actually the costs of investigations and Suspicious Activity Report filings rather than the hardware itself that eats up the vast majority of compliance budgets.
“Most software applications used to detect money laundering are extremely inefficient, delivering only one case-worthy alert per every 100 generated,” explains Dr. Michael Recce, Chief Scientist at Fortent and author of the paper, Taking Costs Out of Compliance: Smart Ways to Boost Your Operation’s ROI. “This level of operational inefficiency wastes a huge amount of time and money in AML compliance operations. It also increases regulatory risk.”
Ray Parodi, Fortent’s Group Executive, Product Management, adds, “Looking across the full range of AML compliance activities for our clients, we have developed solutions that address the key cost factors that impact ROI. The most significant driver by far is how much organizations spend on operating their AML systems and all the workflow that surrounds these systems, including investigations.
“We have put our R&D into finding ways to reduce these costs, and have found that using the right technology can lower the total cost of ownership of AML systems by up to 40%,” says Mr. Parodi.
The white paper outlines three discreet steps to lowering ownership costs of AML systems:
“As organizations seek to maximize their returns on investment, there is technology available that can make this happen by creating large operational cost savings,” says Dr. Recce.
“CEOs, expense chiefs, operations officers, and compliance directors can derive immediate value and ROI while at the same time achieving more rigorous compliance standards for regulators.”
Click here to download the white paper.