Advancing Financial Crime Operations with Hyperautomation

AFinancial crime operations (AFC) have evolved rapidly in recent years, with regulatory pressures and competitive forces pushing banks to invest in more effective and efficient systems. As banks seek to improve data collection analytics and decision-making processes, many AFC operations are turning to hyperautomation to accelerate their transformation. A new report from Chartis Research, in partnership with Nasdaq, explores the journey to hyperautomation and how banks can ensure long-term success.

Hyperautomation uses a combination of tools and techniques, including robotics, machine learning, artificial intelligence, and no-code approaches, to maximize the level of automation in a set of processes, thereby removing as many manual activity as possible. According to the report, hyperautomation can not only enable banks to make their data collection, operations and analytics activities incrementally more efficient, but it can also help automate more complex, decision-based activities.

The Chartis report, which focused primarily on Tier 1 banks, found that hyperautomation leads to time and cost savings of up to 90%, especially for investigations and remediation. Specifically, the report found that implementing hyperautomation in banks’ AFC operations:

  • 90% reduction in the time required for Level 1 investigations and 75% reduction in the number of full-time employees spent on repetitive manual tasks.
  • Two-thirds reduction in time and personnel required for AFC operations.
  • Eliminate manual collection, consolidation, and standardization of Level 1 exam data, reducing required decisions by up to 60%.
  • Reduced the number of bottlenecks in the alert, risk, and reporting stages.
  • Improved efficiency beyond the AFC operating process, with reductions of up to 90% in manual data extraction and processing for reporting to internal audit, policy and risk.
  • Creating powerful analytics to enable continuous improvements in AFC.

Chartis also analyzed a Tier 1 bank as part of the research report, revealing that by automating some of its AFC operations, the bank was able to combine many key processes, including customer due diligence, transaction monitoring and anti-money laundering filtering.

“Automating these work-heavy processes has reduced workload by 75%, increased efficiency in areas such as audit and risk, and improved traditionally ‘non-automated’ areas of the AFC workflow ( such as investigations),” the report said.

As hyperautomation has become increasingly essential to AFC operations, Chartis outlined three steps to establishing effective hyperautomation based on his research, including:

  1. Basic automation. Most banks are currently at this stage. The separate automated areas are not linked and significant manual input is still required in many processes. Individual elements (such as parts of the CDD process) are automated through workflows and data flows. Sanctions screening is also typically automated, often with AI/ML applications in the background to help reduce false positives and manage alerts.
  2. Analysis automation. By automating the decisions and analyzes that flow through the AFC architecture, banks can virtually eliminate important manual processes. By applying analytics upstream and downstream of the process, they can develop better rules on everything from data collection to risk metrics. At this point, processes such as surveys can be effectively automated.
  3. Self-service, no code. At this point, the architecture of the AFC unit and the technology that supports it are well integrated. This frees up end users previously engaged in highly repetitive manual tasks to perform complex analyzes and make decisions that more closely align with enterprise risk policy.

Chartis Search

At Nasdaq, we strive to reduce the burden of manual processes in all financial crime prevention activities for banks around the world. With the Nasdaq Automated Investigator for AML, an innovative technology that replicates the processing of alert investigations and decisions made by human analysts today, financial institutions can focus more resources on the risks that matter.

Read the full report here.


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