Have you ever wondered what an AML analyst is exactly? What is the role of an AML analyst? Today in this blog we will be taking a closer look at the duties, procedures, and significance of this crucial position.
What is AML Analyst? Why Are They Critical to Financial Crime Prevention?
As a key figure in financial crime prevention, an AML analyst simply watches for illegal money activities and fights crimes against terrorism. It is more likely for an AML analyst to put up a lot of effort in order to make sure if their companies are abiding by the AML laws and protect themselves from possible financial and reputational hazards or not.
What Does an AML Analyst Do?
The duties of an AML analyst usually consist of multiple checkboxes but they can vary too. Following are few of them:
Transaction Monitoring: It has been an obligation for the AML analyst to keep an eye on the account activity and transactions, looking for any unusual or suspect trends that might point to fraud, money laundering, or the funding of terrorism altogether. They do utilize specialized software with an aim to check the transactions for red flags from a big horizon of odd transaction amounts, frequency, or jurisdictions.
Customer Due Diligence (CDD): There is another essential component of the AML analysis procedure which is supposed to carry out exhaustive due diligence on both new and current clients. The check of customer due diligence by the AML analysts plays a great role in making sure that the right paperwork is gathered and kept up to date, assess risk levels, and confirm the identity of customers also.
Examining Suspicious activity: An AML analyst has been more likely to perform the duties of an AML investigator simply through carrying out in-depth investigations into transactions or suspicious activity that are detected by the monitoring systems. Such sorts of investigations become a key element when it comes to examining the details regarding the transaction like its history, client backgrounds, outside intelligence and others.
Reporting: The step of accurate reporting is considered quite essential for the regulatory compliance in addition to helping law enforcement with extra research and possible financial criminal prosecution altogether.
Risk Assessment: It is mandatory for the AML analysts to continuously evaluate the risks which are either way associated with the clients, deals, and business partnerships. They have a great importance as they assist institutions in efficiently mitigating potential AML risks simply through analyzing and categorizing the risks as per the variables like region, product categories, transaction methods, and customer profiles also.
Regulatory Compliance: It is interesting to know that the AML compliance analysts have to make sure if their organizations are following the AML rules as per the regulations or not. It is more likely that they execute policy changes, stay up to date on changing regulatory standards, and counsel management on compliance tactics in order to prevent fines and protect corporate integrity at the same time
AML Analysis Process:
There are several essential steps that are particularly involved in the AML analysis process and explained as follow:
Detection: An AML analyst is more prone to look for questionable trends in transaction data simply through utilizing the sophisticated software and analytics techniques altogether.
Investigation: If there is some sort of discovery made in the first step then a more thorough assessment is conducted during which analysts examine external databases, transaction details, and client profiles too.
Assessment:The assessment process is where AML analysts play a role in assessing the legitimacy and degree of risk which are associated with the highlighted transactions.
Documentation: It has been practiced by the AML analyst to document every finding that preserves an audit trail for further legal requirements.
Reporting: Last but not the least, the suspicious activity is then reported to the appropriate authorities of the particular country for additional action and regulatory compliance.
Importance of the AML Analyst Role:
The factor of stability of the global and local financial system is more likely to depend on the work of AML analysts. They are the game changers as they assist financial firms in avoiding severe financial penalties and harm to their reputation by guaranteeing adherence to the AML requirements. Additionally, they are considered essential in halting the wider harm that money laundering has caused to the society, including the funding of corruption, drug trafficking, and terrorism as well.
