If you have been in the AML/CFT world long enough, you know that right after 9/11, there was a mad rush, by companies not in the compliance industry, to cobble together databases for high-risk individuals and entities, and bring them to market, to sell them to a financial industry now required to elevate their programs to meet new standards. Many of them offered little more, in the way of content, than one could assemble himself from open sources, but which systems were touted as the be-all and end-all to solve AML problems.
Fortunately, the marketplace, meaning the potential users, soon found out that they were being asked to purchase, at significant price points, programs that would not solve their information needs for Account Opening, and while initial purchases were strong, they soon were discredited as posers.
Fast forward to 2023, and the same thing appears to be happening anew; software developers with no previous experience in the AML industry are hawking their platforms, claiming that they can provide AL/ML systems that will deliver fantastic results. The marketplace is crowded with offers.
Unfortunately, such companies, who generally have neither seasoned anti-money laundering subject matter experts who have bench-tested their claims, nor a grasp of the problems unique to the compliance industry, are delivering untested products with no established track record, and which have not been created by people who have literally been there in our field.
It is humbly suggested that, before jumping into bed with an AI program that asserts it will solve all your due diligence needs, you take a hard look at the provider: Does it have an Advisory Board of eminently-qualified experts? Are there experienced people on staff, full-time, who know compliance and can test the program? And who else has used the program successfully? Be
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