Implementing Robust AML/CFT Monitoring Solutions
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This document discusses key considerations for implementing an effective anti-money laundering (AML) and counter-terrorist financing (CFT) monitoring solution. It notes that only 29% of technology projects are successful and discusses how adopting an agile methodology can help, with 58% of small agile projects being successful. The document outlines factors for analysis, design, building, testing, and implementing an AML/CFT solution, including data, technology, process, monitoring capabilities, controls, and residency/cloud options. It emphasizes the importance of testing solutions for effectiveness and efficiency.
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Implementing Robust AML/CFT Monitoring Solutions
- 1. AML/CFTTechnology Solutions Implementing robust, effective and efficient AML/CFT Monitoring Solutions Francois Combrinck
- 2. 29% ofTechnology Projects are Successful: Delivered on time, within budget, within scope, realized value and satisfied stakeholders* * Source: Standish Group Chaos Report 2015 19% ofTechnology Projects are outright failures and failed to meet any success criteria 29% Success 19% Fail 52% ofTechnology Projects meet only some success criteria 52% Challenged
- 3. 58% of Small projects using an Agile methodology are successful. Collaboration • Executive Sponsorship • Emotional Maturity • User Involvement Process • Optimisation • Standard Architecture • Agile Process • Modest Execution Expertise • Skilled Resources • Project Management Expertise • Clear Business Objectives
- 4. • Individualsand Interactionsover processesand tools • Workingsoftware over comprehensive documentation • Customer Collaboration over contractnegotiation • Respondingto change over followingaplan Source: agilemanifesto.org • IncreasedRevenue • Reduced Speed to Market • IncreasedQuality • IncreasedVisibility • Improved Risk Management • Greater Flexibility • Greater Cost Control • More Engagement • IncreasedCustomer Satisfaction • Right Product Source: allaboutagile.com What is Agile?
- 8. Analysis Design BuildTest Implement Analysis Design BuildTest Implement Coverage • ProductsCoverage • SystemsCoverage Risk • Product Rules • Money Laundering Risks Compliance • Internal Policies • NationalLegislation • InternationalBest Practiceand Standards
- 9. Quality requirements are Source: A Guide to the Business Analysis Body of KnowledgeVersion 3.o Analysis Design BuildTest Implement “A useful representation of a need” Solution Agnostic Testable Clear and Unambiguous Complete Consistent Prioritized
- 11. Analysis Design BuildTest Implement Technology Process Data Complete Monitoring Control Residency
- 12. Data ConsiderationsTechnology Process Data Monitoring Universe Control Cloud Most Appropriate Source Transformations from system of record to monitoring Understanding the risk introduced by each transformation Completeness of data
- 13. Technology ConsiderationsTechnology Process Data Monitoring Universe Control Cloud Most Appropriate Solution or Solutions Size vs. Sophistication Market Leader or Startup The Myth of the TacticalSolution
- 14. Process ConsiderationsTechnology Process Data Monitoring Universe Control Cloud Integral to Overall Solution Analysis Processes for Efficient Analysis and Effective Reporting Control Processes to Ensure Effectiveness and Efficiency of Monitoring Change Processes
- 15. Solution Controls Technology Process Data Monitoring Universe Control Cloud Operational Controls for Effectiveness Controls that monitor data completeness Controls that monitor process execution Operational Controls for Efficiency Controls that monitor back-end and front-end stability Controls that monitor quality of alerting Controls that monitor quality of alert analysis Controls that monitor quality of reporting
- 16. Solution Residency ConsiderationsTechnology Process Data Monitoring Universe Control Cloud Multi-Jurisdictional Monitoring Solutions Desired Level of Control Desired Level of Oversight Data Privacy Cloud
- 17. Cloud Computing OptionsTechnology Process Data Monitoring Universe Control Cloud Solution Hosted On-Site (No Cloud) Infrastructure as a Service (IaaS) Platform as a Service (PaaS) Software as a Service (SaaS) MoreControl, GreaterFixedCost LessControl,Less FixedCost
- 20. Analysis Design Build Test and Tune Implement • Alert Quality • False Positives • Machine Learning • Money Laundering Risk • Coverage • Systems Processes • Business Processes • Completeness • Accuracy • Controls Testing for Effectiveness Testing for Efficiency Tuning for Efficiency Tuning for Effectiveness
- 22. Sources • Standish Group: Chaos Report (2015); Summary extracted from https://www.infoq.com/articles/standish- chaos-2015 on 3 October 2016. • Benefits of Agile: Retrieved from allaboutagile.com on 22 October 2016 (http://www.allaboutagile.com/10- good-reasons-to-do-agile-development/) • The Agile Manifesto: Retrieved from agilemanifesto.org on 22 October 2016 • International Institute of Business Analysis: A Guide to the Business Analysis Body of KnowledgeVersion 3.0, April 2015. • Joe Barios:What Every Business Analyst Must Know About Cloud Computing; Retrieved from https://www.joebarrios.com/five-things-business-analyst-know-cloud-computing/ on 23 October 2016. • PriceWaterhouseCooper: StressTesting anti-money laundering / counter-terrorist financing frameworks for the securities industry; Retrieved from http://www.pwchk.com/webmedia/doc/636119486865834411_forensic_anti_money_laundering_oct2016.p df on 2 November 2016 • Keith Furst: How to Conduct an AML System Assessment