Threat of Organised Crime Biggest Compliance Fear Facing Firms

  • Risk Management
  • 26.03.2021 09:40 am

Organised crime is the biggest compliance-related fear facing firms, but almost half of organisations do not have a fully integrated client monitoring solution as part of their risk management process, according to a new survey by NorthRow.   

Effective client monitoring is a key priority in the compliance processes of all organisations, particularly those in regulated business within the banking, financial services and property sectors. Over the past year the pandemic has led many firms to expedite their digital transformation, bringing forward the need for online transaction-based activity rather than in-person face-to-face.

More than 80% of organisations are actively monitoring their client portfolio, according to a survey of 400 attendees, including compliance professionals from banks and financial services firms, to a recent webinar* hosted by compliance solution provider NorthRow. This active ‘Know Your Customer’ monitoring helps firms to comply with regulations and avoid becoming involved in corruption, terrorist financing, and money laundering. 

When asked how well client monitoring is integrated into their organisation’s risk processes, only 29% said that monitoring is fully integrated into their CRM, while 31% said it is part of their risk dashboard. 40% said that they use a standalone or point solution for client monitoring, or that they it is not integrated into overall risk processes at all.

More than a third of respondents (35%) said that organised crime is the biggest compliance threat on their radar, while 26% cited regulatory divergence as their number one concern. 

Adam Holden, NorthRow CEO, said: “Over the customer lifecycle, there will be continuous changes in your customers’ risk profile, for example, company structures, beneficial ownerships, directorships and more importantly, their financial stability. The pandemic has added to the frequency of these changes at unparalleled speed, including an increase in insolvencies and money laundering activities. 

“While it is encouraging that the majority of organisations are actively monitoring their clients, the findings that less than a third of firms have monitoring fully integrated into their CRM is a surprise. The right digital solution, tailored to the individual requirements of a business, enables ongoing monitoring and reduces the risks presented by cumbersome manual systems.”

The benefits of client monitoring are not limited to fighting organised crime and meeting regulatory requirements. Almost half of survey respondents (45%) said monitoring is important for client retention, while a quarter (24%) said that it aids cross-selling.


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