2020 Financial Crimes Trends in MENA

In the last few years, there has been significant investment in compliance tools and processes, but the level of commitment has remained comparatively low in MENA.

In fact, recent surveys show that 36% of compliance executives in the region do not have confidence in the effectiveness of their institutions’ financial crime solutions.

One of the key overlooked factors is the use of state-of-the-art and breakthrough technologies, which is critical in achieving results, but is often delegated to “good-to-have” investments.

Besides the missing technology aspect, these executives often have little access to trustworthy data, and rely heavily on human intervention and basic intuition.

That said, in the current COVID-19 times, many businesses have been forced to move their operations online, effectively opening the door wider to financial criminals.

The Need to Tighten Screening

Identity-related fraud has seen significant growth, which makes it crucial to tighten screening and due diligence protocols. This is the time to increase controls rather than relax screening. It is the time to use the right data, tools, and insights.

For all Compliance Officers, here are some of the key factors to consider in your pursuit of hyper-vigilance:

Reinforced Digital Identification

Financial institutions and organizations are now adopting new digital identification technologies to cope with the increasing compliance demands.

For instance, the Central Bank of Bahrain has recently announced the use of eKYC in all the Kingdom’s financial institutions. This is a national eKYC program that enhances the CDD requirements for all financial services providers in the Kingdom including banks and exchanges.

The eKYC platform is run by Bahrain’s Electronic Network For Financial Transactions (BENEFIT), in collaboration with the Information and eGovernment Authority (IGA) and supervised by the CBB.

The goal of the program is to provide all financial institutions with a regularly updated national identity database and to validate customers’ data faster and more effectively.

As financial criminals employ more sophisticated technologies, it is important for financial institutions to invest in the best digital identification technologies possible. It is for this purpose that Screena Firm has been geared to offer an all-encompassing enterprise solution that meets the highest standards of precision, recall, scalability and security. The outcome: your results are relevant and correctly classified. In no time and at all times.

Understanding Your Risks

Risk assessment is another important factor to consider during the client onboarding process and as the relationship with your customers evolves over time. Modern compliance measures require a timely and perpetual risk assessment to ensure that you are always making the best decisions, accelerating your business without ever trading off security for efficiency.

Strict Regulatory Environment

Compliance has become increasingly complex due to heightened regulatory scrutiny. Recent regulations including the EU’s Fifth Money Laundering Directive have had a huge impact on the compliance process, while also extending the scope of AML/CFT requirements to new obligated entities such as fiat-to-crypto exchanges, digital wallet providers, estate agents, art traders, auditors, external accountants and tax advisors.

Other regulations related to anti-money laundering (AML) requirements as well as to the anti-bribery and corruption (ABC) rules have made compliance a major challenge for many financial institutions and organizations. It simply cannot be done without fully automating the identity-check and CDD processes.

At The End It is All About Data

While technology does indeed help solve the biggest part of the equation, the focus should still be on the quality of the data ingested and on empowering the right human decisions. Successful compliance departments, businesses and institutions need to invest more in data quality. This also means efficiently screening relevant identities against AML, PEP and third-party risk intelligence databases in sub-second speed, and providing a reliable approach to reducing both False Negatives and False Positives.

This is precisely our mission at Screena, as relected in our mantra which is to have absolutely no tolerance for any sort of “good enough” rate on False Negatives and False Positives. One mistake can cost your firm dearly and we aim to bring that risk as close to zero as possible.