AML & KYC Compliance Software for Financial Services

The 5th EU Anti-money Laundering Directive (5MLD) came into force on January 10th 2020 and although most of the content in this directive was built on recommendations already made in 4MLD, there were several important changes that have proved to be especially impactful. To discover what those are, click here.

The EU Anti-Money Laundering Directive (6MLD) came into effect on the 3rd of December 2020 and had to be implemented by every institution in the regulated sector by the 3rd of June 2021. Discover more about this directive.

The UK anti-money laundering regime requirements are set out in the Proceeds of Crime Act 2002 (POCA 2002), the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLR 2017), the Terrorism Act 2000 (TA 2000), the Crime and Security Act 2001 (ATCSA 2001) and the Terrorism Act 2006 (TA 2006).

SmartSearch’s award-winning digital compliance solution can perform a KYC check in just 2 seconds and KYB checks in as little as 2 minutes.

SmartSearch uses Equifax, Experian, TransUnion, Dow Jones, Companies House and LSEG which gives us the broadest and deepest coverage and the most frequent update policy to deliver an industry-leading match rate of up to 97%.

A risk-based onboarding process can include KYC checks for individuals, KYB checks for businesses and beneficial owners, document or biometric verification where appropriate, sanctions and PEP screening, customer risk assessment and referral of higher-risk cases for further review.

KYC verifies individual customers, while KYB verifies businesses and the people who own or control them. Customer Due Diligence is the wider risk-based process that combines verification with screening, risk assessment, understanding the relationship, and ongoing review.

EDD should be considered where the customer or relationship presents higher financial-crime risk. The depth of additional checks should reflect the risks identified through the firm’s CDD process, with appropriate evidence, review and monitoring recorded.

Financial services firms should apply risk-based controls that include customer identification and verification, beneficial-owner checks, Customer Due Diligence, sanctions controls, ongoing monitoring and appropriate record keeping.

Higher-risk relationships may require Enhanced Due Diligence and additional approval or monitoring. 

Screening should consider relevant individuals, businesses, beneficial owners and connected parties, with potential matches investigated rather than treated as automatically confirmed. Firms must also consider whether an entity is owned or controlled by a designated person, even where the entity itself does not appear on the UK Sanctions List.

Customer risk can be assessed using factors such as customer or entity type, geography, products and services, delivery channel, ownership structure, expected activity, funding, and screening results. The outcome should determine the depth of CDD, approval requirements, and level of ongoing monitoring applied.

Ongoing monitoring keeps customer information and risk under review after onboarding. Changes in identity or business information, ownership, sanctions or PEP status, adverse media and expected activity can trigger reassessment, escalation or further due diligence. SmartSearch provides ongoing monitoring capabilities alongside its AML/KYC workflow.

Transaction monitoring helps firms compare activity with what is known and expected about the customer, identify unusual behaviour and determine whether further investigation or escalation is needed. It should form part of the wider ongoing customer-risk process rather than operate independently from CDD.

Firms should be able to evidence how customer risk and compliance decisions were reached. A useful audit trail can include identity and business evidence, risk assessments, screening results, analyst reviews, approvals, due diligence decisions, and monitoring history.

Yes. SmartSearch supports integration with existing software through RESTful APIs, allowing compliance capabilities to form part of wider customer-onboarding and operational workflows.