Financial Companies

Financial companies, such as online stock brokers, electronic payment providers, forex trading firms, and other fintechs are required to implement a comprehensive set of risk assessment and compliance procedures to comply with Anti-Money Laundering (AML), know-your-customer (KYC), and other financial directives.

Many financial jurisdictions, notably the United States, the United Kingdom and the European Union, are becoming stricter in demanding compliance from what were previously seen as start-ups. The examples of the UK Financial Conduct Authority (FCA) fines on Revolut or Germany’s prosecution of Wirecard after its collapse are all indicative of an environment of enhanced regulatory supervision and due diligence.

Many fintech, electronic payment and financial companies are also characterized by having a large number of small, retail accounts, many of which fluctuate between periods of activity and inactivity. This means that the AML and KYC procedures are critical, especially because financial firms tend to attract business from a large number of different countries.

Some of the key AML procedures that online financial companies should implement include:

• Risk Assessments: Financial companies should conduct frequent risk assessments to identify and assess the money laundering and terrorist financing risks associated with their customers, products, services, and geographical locations. This can help them to determine the appropriate level of due diligence required for each customer and transaction.
• Know-Your-Customer (KYC) Due Diligence: Financial companies should collect and verify customer information, such as name, address, and identification documents, to ensure that they know their customers and can assess their risk profile. They should also monitor customer transactions to detect and report suspicious activity.
• Enhanced Due Diligence (EDD): Financial companies should conduct enhanced due diligence on higher-risk customers, such as politically exposed persons (PEPs), to obtain additional information about their source of funds and the purpose of their transactions.
• Suspicious Transaction Monitoring: Financial companies should monitor customer transactions to detect and report suspicious activity, such as unusual transaction patterns or large, unexplained transactions.

WorldAML supports online and traditional non-banking financial sector companies in designing and implementing world-class AML and KYC risk management and compliance procedures. Through the WorldAML API, financial companies can directly integrate the search results for initial applications, or can implement periodic updates for established customers. The WorldAML database integrated 2,500,000 sources of information world-wide, providing a comprehensive analysis of most jurisdictions world-wide.

By using WorldAML and the WorldAML API, risk assessment and compliance procedures for financial companies, clients can help prevent their services from being used for money laundering and terrorist financing activities, protect their customers, and maintain compliance with American, European and global AML and KYC regulations.