The Future of Technology in Customer Identification & Relationship Risk

Thomson Reuters Accelus, pp. 1-13, November 2013

13 Pages Posted: 3 May 2014

See all articles by Angela Irwin

Angela Irwin

University of South Australia

Kim-Kwang Raymond Choo

The University of Texas at San Antonio

Date Written: 2013

Abstract

This paper examines the technological challenges faced by financial institutions in setting up, managing and maintaining an effective Know Your Customer (KYC), Customer Due Diligence (CDD) and Customer Identification Program (CIP); as well as the future of money laundering and terrorist financing risk management with a focus on technologies.

Knowing a customer well helps a financial institution to manage their risks and meet regulatory requirements. However, it is one of the major challenges faced by financial institutions every day. Despite increased investment in AML/CTF systems, the systems in place by many financial institutions fall well below the standard necessary to deal with current or future regulatory demands placed on the industry. This paper discuss the challenges faced by financial institutions and how cloud computing and big data analytics may help financial institutions to better position themselves to more effectively deal with vast amounts of data and their ever-changing regulatory environment.

This paper also discusses a three-pronged approach which may be used to ensure the effective use of up-to-date intelligence, make careful predictions about future trends in information and communication technology (ICT) and the scale of money laundering and terrorism financing risk landscape and ensure that appropriate controls are in place to ensure the resilience of AML/CTF strategy.

Keywords: Anti-Money Laundering, Counter Terrorism Financing (AML/CTF), Know Your Customer (KYC), Customer Due Diligence (CDD), Customer Identification Program (CIP)

JEL Classification: C88, C89, K42, K49

Suggested Citation

Irwin, Angela and Choo, Kim-Kwang Raymond, The Future of Technology in Customer Identification & Relationship Risk (2013). Thomson Reuters Accelus, pp. 1-13, November 2013. Available at SSRN: https://ssrn.com/abstract=2431944

Angela Irwin

University of South Australia ( email )

37-44 North Terrace, City West Campus
Adelaide, South Australia 5001
Australia

Kim-Kwang Raymond Choo (Contact Author)

The University of Texas at San Antonio ( email )

San Antonio, TX 78249
United States
+12104587867 (Phone)

HOME PAGE: http://https://sites.google.com/site/raymondchooau/

Register to save articles to
your library

Register

Paper statistics

Downloads
165
Abstract Views
833
rank
179,085
PlumX Metrics