4 things to consider when hiring AML staff

Financial institutions needing to beef up risk compliance efforts next year should start looking for AML candidates now

Financial institutions are in scramble mode. Increasing risk regulations such as the ones announced earlier this year and looming multi-million dollar fines for anti-money laundering (AML) non-compliance have created a big demand in the financial industry for AML experts. As the demand increases, so do the salaries — as well as the sheer number of unsuitable job applicants who just want to grab the golden ring, regardless of their AML experience. Appropriate candidates are so hard to identify that, in many cases, banks have found it easier to poach from each other or accept less-qualified applicants than spend the necessary time and resources to vet the right candidate.

As a hiring manager, it is tempting to just fill open positions with bodies, acting on the mistaken belief that simply throwing more people at a problem will resolve it. This is short sighted, and not a sustainable management practice. Instead, banks should exercise a bit more caution in the hiring process, especially in regards to AML teams. This is a high-stakes game, and not just for the banks. A bank’s new AML employee might want to brush up on the Yates memo (if they haven’t already), and make themselves aware of his or her own potential for personal liability regarding AML cases, especially in light of recent FinCEN and FINRA actions against individuals.

From the bank’s perspective the stakes are high as a result of the initiatives such as the Yates memo, but also because the US government is intent on cracking down on banks not currently complying with AML regulations. As an example, Commerzbank AG’s settlement for AML infractions earlier this year was a hefty $1.45 billion. To avoid these massive penalties, banks need experts with deep AML experience and industry knowledge on their AML teams, not just bodies.

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Richard Paxton

CEO of the Alacer Group. Sharing the latest news in financial crimes and best practices that enable financial institutions to prevent money laundering.

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