Even in its second year of investigation, the flames of the 1Malaysia Development Berhad scandal are still burning strong. Malaysia’s Prime Minister, Najib Razak, is accused of funneling more than $900 million from a government-owned sovereign wealth fund into his personal bank accounts. Banks, bankers, politicians, and even Hollywood celebrities have been connected to this scandal. Although Malaysia’s Attorney-General cleared Razak of any wrongdoing in 2016, several countries have continued their inquiries into money laundering linked to the funds.
To avoid similar corruption scandals in the future, Asia-Pacific (APAC) territories such as Hong Kong want to push for tighter anti-money laundering (AML) enforcements. Because APAC is home to the fastest-growing economies and the countries with the largest populations in the world, the region is a hotbed for complex money-laundering channels. Many banks in the region manage a wide range of services across borders in a tangled network of jurisdictions, and it’s increasingly difficult for them to navigate this environment.
So how can banks in APAC thrive in the AML maze?
It’s all about balance—banks must find an equilibrium between overseeing AML, combating the financing of terrorism controls, and providing business-friendly financial services. This should be embedded in a bank’s corporate culture and branch out to the day-to-day operational processes. Maintaining this stability is easier said than done, but luckily the financial services industry is beginning to provide helpful solutions.
New regulatory technology players are emerging with creative products and services to reshape the financial services ecosystem. APAC regulators in the region are also encouraging collaborative efforts such as shared Know Your Customer databases and services. Plus, more solutions are becoming available for organizations that prefer a personalized approach. Appway, for example, launches four new solutions this year tailored to various regions, banking businesses, and stages of the client lifecycle.
Tailored solutions empower compliance departments and employees to approach different types of banking clients in a personalized way, by combining industry best practice with innovations in process and technology. This makes it easier to automatically identify risks up front, efficiently complete all necessary AML checks and due diligence, and guarantee compliance—all while providing pleasant and professional customer experience.