Evolution of Financial Crime Compliance: The People & Tech Imperative

Evolution of Financial Crime Compliance: The People & Tech Imperative

What’s in this report from AML RightSource & HFS Research:

While financial services firms have been some of the earliest and most extensive adopters of cutting-edge technologies, a scarcity of skilled talent, organizational silos and lack of C-suite support remain significant barriers to AI and automation in financial crime programs, according to a new study by AML RightSource and HFS Research, which found that only 18% of fincrime compliance leaders are using AI and automation.

But adoption is expected to heat up, rising by more than 70% in the next two years, meaning fincrime compliance leaders now face a new people and tech imperative.

“Amidst expanding regulatory requirements, compliance functions are under tremendous pressure to adapt to the risks of today’s ever more interconnected and digitized landscape at speed and scale,” said Frank Ewing, AML RightSource CEO. “Financial services firms are showing a greater willingness than ever before to invest in regulatory risk and compliance programs.”

Other key findings:

• Talent, organizational silos and lack of C-suite support are the biggest internal challenges for fincrime compliance programs amid burgeoning innovation, smarter criminals and rapidly changing financial transaction models.
• Compliance leaders expect their budgets to increase by about 10% in 2024.
• Many regulatory compliance leaders (41%) believe the easiest path to AI and automation adoption is through their existing platforms and systems. Using service providers and building in-house are viable alternatives.