When we examined a handful of recent sanctions enforcement actions, some interesting trends and themes emerged. Banks and financial institutions that prepare for these hurdles, I believe, can have strong and positive outcomes. In my talk at the ACAMS 14th Annual AML & Financial Crime Conference I explored these three common trouble spots:

1. Employee negligence

Too many companies wait until they are faced with regulatory enforcement actions before updating their Anti-Money Laundering (AML) and sanctions compliance communication and training programs. That means personnel aren’t aware, familiar or knowledgeable of regulatory requirements or policy updates, let alone any of the implications.

Using these approaches can help prevent mistakes:

  • Drive effective executive leadership messaging, with strong and consistent “tone at the top” in order to build a compliance culture.
  • Launch a defined learning capability strategy that includes a global learning program for all employees, ideally leveraging case-based training methods that simulate real challenges.
  • Build multiple lines of defense, including internal controls supplemented by independent testing and audits.

2. Technology limitation

Financial institutions should consider sanctions solutions and screening software that can support regulatory requirements while minimizing time, resources and operational risk. But this isn’t always what they do. Some firms try to stretch temporary solutions and stopgap measures into permanent answers. And in some cases they are wasting time and effort with inefficient interim solutions.

Institutions should instead create a strategic roadmap in order to perform long-term objectives using a comprehensive sanctions technology architecture that is automated and integrated. The platforms in scope should include:

  • Visual analytics tools or real-time dashboards for identifying patterns, anomalies and trends.
  • Data warehouse and data feeds to access the right data.
  • An advanced screening solution using efficient name matching algorithms to monitor and detect alerts.
  • Case management to handle robust workflow and generate reports.

3. Data issues

Institutions are trying to improve the effectiveness of their AML monitoring systems, but are they looking at the right things? Many may have overlooked the periodic review of AML source data, essential for a fully functioning and efficient AML monitoring system.

There are several other elements to consider around data monitoring:

  • Data quality and data integrity, ideally focused on data sourcing analysis and data quality analysis, assessing completeness, conformity, consistency, accuracy and duplication.
  • Integration of KYC and sanctions screening to capture the right information up front and include it in sanctions data feeds.
  • A risk-based approach to sanctions screening that results in an efficient set of procedures that places greater effort around higher risk areas.


What happens after large-scale remediation programs and look-back efforts come to an end and enforcement actions are closed? It may mean good news for financial institutions—but it isn’t the whole story.

Financial institutions should maintain an on-going sanctions program in order to assess their capabilities against industry preferred practices, identify strengths and weaknesses, pinpoint improvements that address poor capabilities and develop a long-term road map to build and maintain a sustainable sanctions program.

For more, see talking points for my ACAMS presentation on sanctions enforcement actions.

Examining Recent Enforcement Actions

View SlideShare: Examining Recent Enforcement Actions for Critical Lessons Applicable to Your Institution

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