Financial Crime Regulatory Challenges

Financial Crime Regulatory Challenges
19/07/2021 MHC

Understanding Financial Crime regulatory challenges with recourse to Intelligent Automation

  • $20 Billion is spent by European banks every year to fight financial crime.
  • 90% of European banks have been fined for AML-related offences in the past decade.
  • Globally, banks have been fined approximately $26 billion over the last 10 years.

In this article, we explore some of the challenges presented by financial crime regulation and offer insight into how technology can be applied to help meet evolving regulatory requirements, whilst maintaining the agility required to pivot your existing processes in line with new requirements in future.  

Mansion House Consulting (MHC) are financial crime experts who work with some of the largest financial institutions in the UK. At MHC, we work exclusively in the financial services sector and apply our industry expertise to your existing process baseline to make tactical recommendations that deliver measurable, incremental improvements to your organisation. 

In partnership with Reply, we are able to leverage their intelligent automation expertise to introduce process mining, digital process monitoring, and robotic process automation for our customers. 

In what follows, we identify the challenges that our customers are currently facing within the financial services landscape, placing specific emphasis on regulation for financial crime prevention and detection. 

Regulatory Challenges

Incremental financial crime regulation is adding significantly to the costs financial institutions must bear, driving a need for solutions which reduce costs without compromising risk management and regulatory compliance. 

Consequently, this is driving heavy investment in technology-enabled controls and compliance processes. However, many financial crime risk management processes and systems today still require significant manual effort. 

Remaining compliant within an evolving regulatory landscape is difficult as there is frequent revision of requirements which can undermine the capability of existing systems and processes, in turn proving a challenge to understand what changes within your organisation are actually required in order to comply.  

We find that our customers often have numerous systems and processes in place that can require careful orchestration in order to make any modifications or enhancements. 

This difficulty is further exasperated by a high human dependency within key processes, which can pose a training challenge insofar as ensuring that new regulations are always followed and managing the risk of an inconsistent implementation of requirements between individuals. 

Rolling out process changes across large staff volumes introduces risk and additional training costs, and further diverts your human resources away from high-value, complex queries, which, by extension, doubles down on re-training for repetitive processes. 

Repetitive processes that rely on large numbers of human processors also introduce scope for natural human error and can make it difficult to collate key data from a process to feed into additional controls, insights, and core data analytics.  

When aligning regulatory requirements against processes that typically carry a highly repetitive human burden, the following use cases are common: 

  • Know your customer (KYC) 
  • Transaction monitoring 
  • ISO 20022 SWIFT updates 
  • Tracking suspicious activity reports (SARs) such as keeping track of who has beenand who needs to be reviewed.

Fortunately, these processes are fertile ground for automation since they involve a number of time-consuming, rules-based tasks that do not necessarily require direct human oversight, given the technology that is now available.  

To make their processes more efficient, we help financial institutions pursue a range of automation strategies, involving data acquisition, consolidation, and analysis; alert ranking and prioritisation; alert routing and investigator nudging; and automated system health checks, among others.  

Taken together—and combined with other techniques, such as streamlined regulatory filings—these approaches can help financial institutions transform their financial crime investigation programmes and empower investigators without replacing them.

Contact Us

Should you wish to discuss how MHC can support your organisation in understanding how to fully leverage intelligent automation, please contact us at