Banks apply tech, data analytics to combat money laundering

One of the major amendments is to leverage technology on non-face-to-face account opening.

Hong Kong banks will increasingly explore and leverage the use of technology and data analytics to combat anti-money laundering (AML) and counter-terrorist financing in 2018, according KPMG China.

Digital technologies have proven their worth in streamlining such processes especially in the areas of enhancing transaction monitoring, onboarding and CDD processes and are projected to continue by next year, KPMG adds.

KPMG believes that the Hong Kong Monetary Authority (HKMA) plays a critical role in issuing guidance to help banks assess and understand risk.

Certain amendments to operating guidelines in anti-money laundering are also expected to take effect by mid-2018 that will enable a higher level of tech penetration in surveillance and monitoring.

“We expect to see changes to certain aspects of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), as well as the Guideline on Anti-Money Laundering and Counter-Terrorist Financing. The changes are expected to make onboarding more efficient, improve the overall customer experience and align Hong Kong’s rules with international standards,” said KPMG China Partner Kyran McCarthy.

One of the major amendments is allowing greater flexibility and scope to leverage technology on non-face-to-face account opening.

Hong Kong is similarly preparing its first money laundering/terrorist financing National Risk Assessment which will be up for publication in 2017 to help banks improve their own risk assessments and form their own solutions and mitigating measures.