ACAMS Global AML Insight Series Transaction Monitoring

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Global AML Insight SeriesA leading approach to encourage the sharing of information across the globeSurvey Topic: The Effectiveness of Transaction MonitoringJune 1, 2010


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Executive SummaryThe Association of Certified Anti-Money Laundering

Specialists (ACAMS) and Ernst & Young LLP (EY)

recognized the need for thought leadership in the AML

community that is both timely and focused on

current topics and trends. We agreed that a series of

surveys would best address this need. On a periodic

basis, the survey series will explore emerging anti-moneylaundering strategies and practices, ranging from

program design and effectiveness, to leading practices

for mitigating the risk posed by money launderers. Our

intention for the Global AML Insight Series is to

encourage the sharing of information across the globe

and industries, and to facilitate AML program

comparison and improvement.

At the onset of our endeavor, we established principles to

guide all surveys within the series. First, surveys had to be

designed in such a way that they can be circulatedmultiple times per year. With this core principal in mind,

each survey had to be brief and flexible enough to address

hot topics, target various financial institutions across

the world, and provide a multiple choice style format to

ensure consistency across languages and industry

sectors. To maximize the response rate and capture

honest answers, all survey responses had to be

confidential.

We are pleased to provide the results of our first survey

The Effectiveness of Transaction Monitoring. We hopeyou find the survey results valuable and thought-

provoking.

Table of Contents

Topic Overview 1

Survey Highlights 2

Implementation Considerationsand Strategies 5

Effectiveness of Solution 8

Transaction Monitoring and

Alert Tuning Techniques 14

Current and Ongoing Costs/

Overall Satisfaction 19

Key Contacts Back Cover


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Topic OverviewThe first survey of this series is focused on one of the

most debated topics among AML professionals and

regulators the effectiveness of AML transaction

monitoring. Financial institutions of all sizes are

challenged with generating productive results while also

balancing the investment required to achieve these results.

Transaction monitoring is one of the key agenda itemsfor AML compliance professionals when addressing their

regulatory requirements. It also is one of the more costly

components of an AML compliance program and may

require sophisticated technology solutions to integrate

into complex operational environments. In this survey,

we explore:

implementation considerations and strategies;

effectiveness of solutions;

transaction monitoring techniques and alert tuning;

challenges faced; and

current and ongoing costs, and overall satisfaction.


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2

Survey Highlights

ParticipationThe survey was submitted to AML compliance officers

within large financial institutions (global and regional)

around the world. Over 50 responses were collected

which represent over 20 countries. The map illustrates

the geographic distribution of these survey responses.

No significant differences were found in the responses

based on the geographic distribution of the responders,

and as such, none of the following survey results are

broken down by geography.

The following survey highlights investigate correlations in

the survey responses that may provide insights into how

financial institutions get the most from their transaction

monitoring systems. The next section addresses each of

the individual survey responses and provides observations

and highlights from the responses.

Implementation Considerations andStrategiesThe majority of responders implemented a vendor

purchased AML transaction monitoring system, used

a data hub to support this system, and used this single

system to monitor all lines of business and jurisdictions.

Only one survey responder relied on manual methods.

Credibility with regulators was noted as a key consider-

ation when selecting a vendor system over an in-house

developed system, while the upfront costs in-house

were the key considerations when selecting an in-house

developed system.

Americas59%

EMEIA30%

Asia Pacific11%


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Current and Ongoing Costs/OverallSatisfactionUpfront and ongoing costs are key considerations in

selecting a transaction monitoring system. In 2010, 65%

of survey responders will spend less than $1M on their

transaction monitoring systems. There is no apparentcorrelation between the age of a system (i.e., how long

ago the system was originally implemented) and the

planned amount of spend.

In general, the financial institutions that only use a

vendor system to perform transaction monitoring plan

to spend less in 2010 than those that use a combination

of systems.

Despite the majority of survey responders reporting less

than 10% effectiveness of their systems, 75% of survey

responders are at least somewhat satisfied with their

system. Only 25% are dissatisfied. Most responders are

quite satisfied.

Interestingly, although 75% of survey responders are at

least somewhat satisfied with their current systems,

46% of survey responders expect a major upgrade or

replacement of their transaction monitoring system

within the next two years.

.


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ImplementationConsiderations andStrategiesThe survey questions probed implementation strategie

and challenges facing financial institutions when

selecting an approach to implement a transaction

monitoring system. This is often an expensive andchallenging component of an AML program, and

there are many vendors in the market that offer

solutions that aim to address these complexities.

Questions addressed the types of systems that are

being used, what criteria impacted these decisions,

and how these systems addressed multiple lines of

business and jurisdictions for transaction monitoring.


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Is your transaction monitoring systempurchased from a vendor or developedin-house?

Highlights

The majority of responders (64%) indicated that their

organizations have implemented a vendor purchased

system, while only 2% of responders still relied on

manual methods to perform transaction monitoring.

Observations

The software market for AML transaction monitoring

is reaching a level of maturity now that the majority

of financial institutions opt to rely on purchasing the

functionality offered by these platforms. Typically, the

scope and scale of monitoring that is required today

to satisfy current risk tolerances and regulatoryrequirements make it difficult to rely on manual

methods alone. The results indicate, however, that

vendor software does not yet offer a comprehensive

platform to address all transaction monitoring needs.

What factors drive decisions forchoosing vendor vs. in-house systems?

Highlights

70% of responders indicated that vendor solutions

are most appropriate when considering the systems

credibility with regulators. 60% of responders voted

for in-house developed solutions when considering

the upfront and maintenance costs.

Observations

These results are atypical of vendor selection criteria

where typically software customers chose vendors

based primarily on their ability to meet requirements,

the effectiveness of solution to meet those needs, and

the speed of implementation. Clearly the regula-

tory credibility criteria overrules other factors in the

selection process.

Manual methods2%

Vendor purchased64%

In-housedeveloped

11%

Combinationof both23%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Maintenancecost

Ability tomeet

requirements

Speedandeaseof

implementation

Easeof use

Effectivenessof solution

Credibilitywith

regulators

Upfrontcost

63%

16%

21%

16%

61%

23%

22%

41%

37%

33%

27%

35%

16%

40%

49%

27%

16%

57% 69%

23%

8%

Decision factors

Survey

response

Vendor Supplied

No Difference

In House Developed

Implementation Considerations and Strategies


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Do you have a dedicated data ware-house or technology hub which feedsyour transaction monitoring system?

Highlights

The majority of responders (88%) indicated that their

organizations use a dedicated data warehouse or tech-

nology hub to feed the transaction monitoring system.

Observations

Given the risk-guided need to monitor transactions

across a broad array of products, clients, and

jurisdictions, and the disparate and heterogeneous

nature of financial transaction processing platforms,

most AML transaction monitoring systems need the

ability to pull transaction, account, and customer

data from multiple systems. Operating and maintain-ing an AML transaction monitoring environment

without a data hub to address data normalization and

quality requirements would be extremely challenging.

How has your organizationimplemented your transactionmonitoring systems?

Highlights

75% of the responders implemented one transaction

monitoring system and customized it for local

business units while 25% of the responders

implemented different systems to support all the

transaction monitoring needs of the institution.

Observations

The results support the fact that global financial

institutions typically implement one transaction

monitoring system and customize it across geogra-

phies based on the perceived risk of its customers,

geographies and products and services. In addition,

these institutions typically create transaction

monitoring hubs to address differences in legal

matters (i.e., privacy, information sharing).

Yes 88%

No 12%

Single system64%

Multipleinstances one

system11%

Differentsystem25%

Implementation Considerations and Strategie


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Effectiveness of SolutionThe survey questions focused on the ability of the

transaction monitoring systems to produce produc-

tive alerts. Productive means the alert generated was

worthy of investigation, regardless of whether it

resulted in the identification of suspicious behavior.

The questions addressed how effective the system is,

how effective the vendor platform is off the shelf,how robust the scenarios provided by vendor systems

are, and how the factors and challenges impact the

effectiveness of a transaction monitoring system.


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Within your organization, howeffective is your vendor-purchasedsolution?

Highlights

64% of the responders require additional

customization of their vendor-purchased solution.

Observations

The results support the view that vendor-purchased

solutions require additional customization based on

the perceived AML risk of the financial institution

and the institutions unique geographies, product,

and inherent risk. In addition, financial institutions

continuously look to improve the effectiveness of

their monitoring systems to account for emerging

AML typologies as well as changing risk profile of theinstitution.

How effective are the scenariosprovided with vendor-purchasedtransaction monitoring systems?

Highlights

46% of the responders find that the scenariosprovided by the vendor-purchased transaction

monitoring systems provide adequate options to

capture the institutions AML transaction

monitoring needs.

Observations

One of the important aspects of selecting a

transaction monitoring system includes the ability

of the transaction system to offer the necessary

AML typologies based on the institutions AML

risk profile through the scenarios. These scenarios

then are typically tuned further to improve the

effectiveness of the institutions money laundering

detection processes.

Do not use vendorsolutions

8%

Offerseffective off

the shelfmonitoring

12%

Requires additionalcustomization

64%

Requiresextensive

customization16%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Reasonable Too generic Do not use vendor

solution

Very robust

46.0%

38.0%

10.0%6.0%

Factors affecting productive alerts

Survey

response

Effectiveness of Solution


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Of the total alerts raised by yourtransaction monitoring systems, what

percent would you estimate to beproductive?

Highlights

The average productivity rate among responders was

24%. Upon further examination, it is noted that most

responders are far below that average, with more

than half estimating that their transaction monitoring

systems generate 10% or less productive alerts.

Even more telling is the high number of responders

who estimated their productivity rate at 5% or less.

Of these responses, the majority of the answers are

below 5%, indicating that many people are receiving

very low productivity from their transaction

monitoring systems.

Observations

While transaction monitoring systems have been on

the market and deployed at financial institutions for

many years, generating productive alerts and

minimizing false positives remain a challenge for

many companies. Though the reasons for

unproductive alerts could vary widely, common

factors could include data quality issues, improper

scenarios, invalid thresholds or incorrect procedures.As financial institutions improve and mature their

compliance functions and systems, it will be

imperative for financial institutions to benchmark

and gauge their productivity rates to save time and

money and improve the overall effectiveness of their

monitoring program.

Total

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

5 10 15 20 25 30 35 40 45 50 55 60 65 70

Productive alert percentage

Survey

response



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Please rate the following five factorsin generating productive alerts fromyour transaction monitoring system(see chart).

Highlights

Of the various factors needed to generate productive

alerts, responders felt that data quality and proper

or relevant scenarios are the most important factors

in generating productive alerts from a transaction

monitoring system.

The other factors (properly tuning scenario thresh-

olds, incorporating feedback from alert investigations,

and suitability of solution) are deemed important, but

are not as highly valued as having good data quality

and proper scenarios.

Observations

With financial institutions striving to improve the

effectiveness of their transaction monitoring

solutions, this response seems to indicate that

financial institutions could benefit by investing efforts

upfront to identify and remediate data issues and

by taking a considerate, comprehensive approach in

selecting scenarios which are appropriate for the types

of jurisdictions, customers, and products that the

financial institution supports.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Properlytuned scenario

thresholds

Feedbackfrom

investigationof alerts

Proper orrelevantscenarios

Data qualitySuitability ofsolution formy business

lines andproducts

4%

18%

35%

43%

8%

41%

51%

16%

31%

53%

4%

31%

65%

14%

86%

How effective are the scenarios?

Survey

response

Very important

Important

Average

Not important



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Estimate what percentage of yourmeaningful investigations into poten-tial money laundering is identified bythe following sources (see chart).

Highlights

Approximately half of the meaningful investigations

are detected by transaction monitoring systems.

Manual referrals and customer on-boarding reviews

also yield meaningful investigations, but not of the

scale of transaction monitoring.

Observations

While transaction monitoring systems generate the

majority of meaningful alerts, it will continue to be

imperative for financial institutions to integrate and

consider alerts from all sources during investigations.

Please rate the following challengesin relation to operating an effectivetransaction monitoring system.

Highlights

Most responders consider access to data, data quality

and false positives as major challenges to operating an

effective transaction monitoring system. Ongoing

system costs and ease of use seem to be of lesser

concern for the responders.

Observations

Operating an effective transaction monitoring system

can be challenging with constant pressure to iden-

tify meaningful suspicious activity while controlling

costs and coping with poor data quality or improper

system or threshold setups. Firms must often balance

and allocate resources according to highest risk areas

and priorities in order to strike a proper balance

between identifying suspicious behavior and operat-

ing an efficient and sustainable program.

Manual referral ofsuspicious activity

34.39%

Customeron-boardingreview and

controls14.14%

Transactionmonitoring

51.47%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Vendorsupport

Currentor

ongoingsystems

cost

Ease ofuse andmainte-nance

Scalabilityand

customizationto your

businesses

Falsepositives

Dataquality

Dataaccess

29%

19%

39%

13%

20%

43%

23%

14%

29%

25%

31%

15%

20%

39%

16%

33%

23%

18%

31%

20%

20%

22%

23%

35%

11%

10%

29%

50%

Challenge to operating effective system

Survey

response

Slightly

Somewhat

Moderately

Very



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The most common hurdles seem related to the

accessibility and quality of data. If the data needed for

transaction monitoring is not available or is of poor

quality, the results from the solution will often be poor.

It is important for financial institutions to consider

remediating the data and developing ongoing processes

and capabilities to identify and fix issues on an

ongoing basis.

Other factors such as current or ongoing systems cost,

vendor support, ease of use and maintenance, and

scalability and customization to business are considered

less challenging by survey responders, which seems to

indicate that financial institutions are able to cope

with these challenges more readily than the data

quality issues that can plague an effective transaction

monitoring system.



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Transaction Monitoringand Alert TuningTechniquesThe survey endeavored to address the techniques used

by financial institutions to detect money laundering.

This encompassed, at a high level, the techniques typi-

cally offered by vendors in this space, the effectivenessof different rules and scenarios used to detect money

laundering, the techniques used to more effectively

dispose the alerts, and the frequency and effectiveness

of alert tuning.


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What techniques does your organiza-tion employ to support transactionmonitoring?

Highlights

Over half of the survey responders used rules, dynam-

ic profiles, population or peer groups, and link analy-

sis as techniques to perform transaction monitoring.

Rules and scenarios is the most popular technique

used, and static profiles the least popular technique.

Observations

Employing rules and scenarios is the most popular

technique for identifying known money laundering

patterns. Dynamic profiles are useful in identifying

unusual activity, and possibly identifying previously

unidentified techniques for money laundering notalready covered by rules and scenarios. Population

or peer groups provide the ability to identify

outliers when investigating behavior of individual

accounts when compared to groups of similar

accounts, and link analysis can be used to identify

hidden or undeclared relationships. These two

techniques are important when attempting to identify

unusual relationships, but rely on high data quality

and active management of reference data to reduce

the volume of false positives typically generated with

these techniques. Static profiles can also be usefulwhen monitoring accounts with low volumes of

transactional behavior (when it becomes difficult to

build statistical models based on actual behavior), but

also require frequent maintenance and tuning to

prevent high false positive alerts from being generated.

Do you adjust the scope and scale of

transaction monitoring based on theperceived risk of the following factors(see chart)?

Highlights

Over three-quarters of survey responders adjusted the

scope and scale of their transaction monitoring based

on the five factors of perceived risk presented. All of

the five factors were considered and incorporated by

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Static profiles(monitoring

againstexpectedbehavior)

Dynamicprofiles

(monitoringagainst actual

behavior)

Populationor peergroups(similar

behavior)

Link analysis(hidden orundeclared

relationships)

Rules andscenarios

96.2%

46.2%

69.2%

57.7%51.9%

Technique

Survey

response

Transaction Monitoring and Alert Tuning Techniques


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over 70% of the survey responders, with the types of

transactions ranked highest and the line of business

ranked lowest.

Observations

Clearly, transaction monitoring must be taken intocontext along with other risk factors. Most transac-

tion monitoring solutions allow these risk factors to

be incorporated into their platforms, whether it be

through the types of rules they implement to focus on

specific risk factors, the approach they use to weight

and score unusual behavior by these risk factors, or

incorporating perceived risk into the way alerts are

prioritized for investigation.

How are alerts from your transactionmonitoring solution evaluated prior toinvestigation?

Highlights

At least 80% of survey responders performed

additional evaluation on their transaction monitoring

alerts prior to investigation. Over half the survey re-

sponders risk ranked alerts prior to investigation and

just under half combined alerts prior to investigation.

Observations

Financial institutions endeavor to increase the

efficiency and effectiveness of alert review through

initial, manual intervention. As systems are imple-

mented and alerts are continuously generated on daily,

weekly, and monthly cycles, strategies have emerged to

cope with the inevitable backlog of alerts that require

investigation. Adopting a risk based approach to the

investigation focuses research on the highest impact

alerts, but may not sufficiently reduce backlogs.

Combining related alerts (e.g., alerts on the same

customer over different time periods, or combining

alerts for the same set of transactions but generated by

different aspects of a risk and compliance program)

may prevent duplicative work efforts. Employing

techniques to prevent the re-alerting of known accept-

able behavior allows financial institutions to focus their

efforts on potentially more effective alerts.

0%

10%

20%

30%

40%

50%

60%

Various relatedalerts are

combined andlinked prior to

investigation

Alerts areseparately

"filtered" toremove known

false positives

Alerts areinvestigated as

received with noadditional

evaluation

Alerts are riskranked for

investigation

56.9%

45.1%39.2%

17.6%

Alert evaluation technique

Survey

response


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Line ofBusiness

Products Types of Transactions

GeographyCustomers

88%

12%

78%

22%

90%

10%

94%

6%

88%

12%

Survey

response

No

Yes


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Please score the effectiveness of eachof the following scenario types foridentifying suspicious activity relatedto money laundering?

Highlights

Cash scenarios and other scenarios are deemed by

over three quarters of survey responders to be the

most effective scenarios. Early withdrawal and hidden

relationships are deemed by 20% of responders to be

the least effective.

The other scenarios described and deemed to be

most effective are:

1. Unusual activity when compared to the peergroup

2. Quick pay down or early settlement of loans

3. Segregation between location of transactionalactivity, location of accounts, location ofincorporation or place of business, and use ofoffshore shells, plus high risk jurisdiction forcash movements

Observations

Rules or scenarios that capture well established,

known money laundering scenarios are generally the

most effective cash or cash equivalent movements

and structuring and activity in high risk jurisdiction.The effectiveness of other scenario types such as link

analysis or change in behavior scenario types may be

compromised by data quality and false positive issues.

How frequently do you tune (i.e.,adjust scenarios, modify thresholds)your transaction monitoring system?

Highlights

Alert tuning is an integral component of AML

transaction monitoring systems; over 88% of survey

responders tune their systems at least once a year.

51% of the survey responders tune their systems at

least quarterly, and 31% of responders tune their

systems at least every month.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Earlywithdrawal,

disregardfor fees

Rapidmovementof funds

Activity inhigh risk

jurisdictions

Changes inbehavior

Cash orcash

equivalentmovements

andstructuring

OtherIdentificationand

monitoringof hidden

relationships

57%

24%

20%

20%

33%

14%

71%

25%

15%

20%

69%

16%

61%

18% 20%

20%

78%

35%

12%

77%

Scenario

Survey

response

Least Effective

Average Effective

Most Effective



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Observations

Transaction monitoring systems need to be tuned to

stay current with an ever changing risk environment.

Some financial institutions have established positive

feedback mechanisms, where the characteristics of

useful alerts are fed back into the system to improvethe effectiveness of the system. Responders that

tuned their systems more frequently correlated with

both improved effectiveness of the system and also

with higher ongoing costs. Many financial institu-

tions have full-time resources dedicated to tuning

these systems following the initial implementation.

To what extent has tuning improvedthe quality of alerts from yourtransaction monitoring system?

Highlights

All survey responders reported that alert tuning

improved the quality of alerts produced by their

transaction monitoring systems, with over 35% of

responders reporting substantial improvements.

Observations

Alert tuning is a vital component of maintainingan effective AML transaction monitoring system.

Responders reported substantial improvements

regardless as to whether the effective measure of

the system was low (less than 10%) or high (greater

than 50%). In addition, there is a strong correlation

between responders who report that tuning

substantially improved the quality of alerts and

responders who report they tune their system monthly

or continuously. The same is true of responders who

reported tuning mildly improved their system and

responders who reported they tune annually.

.

Only uponinitial system

implementation7.8%

Every monthor nearly

continuously31.4%

Quarterly19.6%

Annually37.3%

System hasnever been

tuned3.9%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Mildlyimproved

Moderatelyimproved

Substantiallyimproved

Did notimprove

31.3% 31.3%

37.5%

Level of improvement

Survey

response



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Current and OngoingCosts/Overall SatisfactionThe survey asked participants about costs and factors

affecting costs with respect to their transaction

monitoring system. This included any potential

sharing of costs that can be done within the AML

program and outside the AML program, the actual

planned spend for 2010, the amount of planned spend

on alert tuning and system maintenance, the age of

the system, and any plans for future upgrades of

the system.


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In what other functions do you usethe data gathered for your transactionmonitoring solution?

Highlights

50% of the financial institutions used the data gath-

ered for transaction monitoring to assist with other

compliance and surveillance needs. Approximately

10% found uses for the data for Marketing and Fi-

nance functions. 20% of the responders used the data

exclusively for AML transaction monitoring.

Observations

While the investment made in a transaction monitor-

ing system may provide other benefits within an AML

program, the specific nature of AML transaction

monitoring systems does not offer or leverage signifi-cant benefits outside of a compliance function. AML

systems appear to be customized solutions to satisfy a

single set of risk and regulatory requirements, rather

than provide broader benefits across the organization.

How much in US$ does your orga-nization anticipate spending in 2010

related to transaction monitoring?Highlights

Approximately 70% of financial institutions plan to

spend less than $1M on their transaction monitoring

systems in 2010.

Observations

There is no significant correlation between the

amount of planned spend on the system and

1) the effectiveness of the system, 2) the overall

satisfaction with the system or 3) the age of the

system. Significant investment is required to imple-

ment new transaction monitoring systems, and also

to upgrade transaction monitoring systems.

Large financial institutions may have significant

expenditure in staffing to investigate the high

volume of alert output, especially in systems with

low overall effectiveness.

0%

10%

20%

30%

40%

50%

60%

70%

Employeemonitoring

Know YourCustomer

(KYC)profiling

Marketing Finance None of theabove

Customerfraud

monitoring

51.9% 51.9%

59.6%

57.7%

13.5%9.6%

23.1%

Use in other functions

Survey

response

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$500K $1M $1M $5M Greater than $5M$0 $500K

46.9%

22.4%24.5%

6.1%

Anticipated spend 2010

Survey

response

Current and Ongoing Costs/Overall Satisfaction


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After the initial installation, whatpercent of your total AML programbudget (e.g., technology, operations,staff) do you expect to spend on sys-tem maintenance and alert tuning?

Highlights86% of respondents expect to spend less than 25%

of the total AML program budget on system

maintenance and alert tuning, with only one

institution expecting to spend more than 50%. There

is no significant correlation between the planned

spending on maintenance and tuning and 1) the age

of the system or 2) the type of the system.

Observations

It is evident that there is a balance to strike in budget-ing for the AML program between maintaining and

improving the transaction monitoring system over

time. This balance may change depending on where

in the implementation lifecycle the financial institu-

tion is, with potentially heavier allocation of budget

to maintenance costs on recently installed systems

that may subsequently be pared down and re-

allocated to alert tuning over time.

When did you initially deploy yourtransaction monitoring system?

Highlights

Less than 20% of responders have deployed their

transaction monitoring system within the last two

years. One in four deployed their transaction

monitoring system more than five years ago.

ObservationsAML transaction monitoring systems are now pre-

dominantly established in most financial institutions.

The chart illustrates the increasing adoption of these

systems over the past decade. Interestingly, the rate of

new systems is now dropping off, with the majority

of responders have initially installed two to three

years ago.

0%

10%

20%

30%

40%

50%

60%

70%

6% 25% 26% 50% Greater than 50%Up to 5%

28.0%

58.0%

12.0% 2.0%

Spend on system maintenance and alert tuning

Survey

response

More than5 years ago

25%

4 5 years ago21%

2 3 years ago38%

Have not deployed orplan to deploy in future

2%

1 year ago14%



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22

Following the initial deployment, financial institutions

look to increase the scope of coverage of transaction

monitoring, to improve the detection functions and

techniques of these systems, and to improve the over-

all effectiveness of these platforms.

Do you expect a major upgrade orreplacement of your transactionmonitoring system within the nexttwo years?

Highlights

Nearly half of the survey responders expect a major

upgrade or replacement of their transaction monitor-

ing system within the next two years.

Observations

Financial institutions need to continue to upgrade and

replace their systems to meet their regulatory AML

transaction monitoring requirements. In addition,

mergers and acquisitions in the financial services

industry in the last few years may have also put

existing platforms under stress that necessitate

upgrade or complete replacement.

Vendor deficiencies and/or vendor new features (such

as link analysis, integrated case management) may

also be driving upgrade plans.

Yes46.2%

No34.6%

Not yetdetermined

19.2%



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How satisfied were you with the over-all effectiveness and value of yourtransaction monitoring solution(s)?

Highlights

75% of survey responders are satisfied with their

transaction monitoring solutions.

Observations

Even as the majority of survey responders are satisfied

with their current solution(s), most are still anticipat-

ing an upgrade or system replacement in the next two

years. This may be reflective of the increased capabili-

ties being offered in the most recent vendor offerings.

.

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Mildlydissatisfied

Somewhatsatisfied

Quitesatisfied

Verysatisfied

Verydissatisfied

7.7%

17.3% 15.4%

44.2%

15.4%

Satisfaction rating

Survey

response



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Key ContactsFor additional information about the results

of ACAMS and Ernst & Youngs Global AML

Insight Series, please contact:

ACAMS

John Byrne

Executive Vice President

[email protected]

+1 703 282 4954

Ernst & Young LLP

Steven Beattie

Principal

Financial Services+1 212 773 6378

[email protected]

Ernst & Young LLP

John Sabatini

Principal

Financial Services

[email protected]

+1 212 773 0619


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About Ernst & Young LLPErnst & Young is a global leader in assurance, tax,transaction and advisory services. Worldwide, our 144,000people are united by our shared values and an unwaveringcommitment to quality. We make a difference by helpingour people, our clients and our wider communities achievetheir potential.

Ernst & Young refers to the global organization of memberfirms of Ernst & Young Global Limited, each of which is aseparate legal entity. Ernst & Young Global Limited, a UKcompany limited by guarantee, does not provide services toclients. For more information about our organization, pleasevisit www.ey.com.

About ACAMSThe Association of Certified Anti-Money LaunderingSpecialists (ACAMS) is the premier organization foranti-money laundering (AML) professionals and theprovider of the Certified Anti-Money LaunderingSpecialist (CAMS) credential the most respectedcertification in the industry. The mission of ACAMS is

to advance the professional knowledge, skills and experienceof those dedicated to the detection and prevention ofmoney laundering around the world, and to promote thedevelopment and implementation of sound anti-moneylaundering policies and procedures.

For more information, please visit www.acams.org

Documents

ACAMS Global AML Insight Series Transaction Monitoring