As institutions invest more in automation, AI improves financial crime compliance efforts

Artificial Intelligence is changing how financial institutions handle compliance with regulations against financial crimes. A survey found that 86% of professionals at banks and non-banking financial institutions (NBFIs) plan to increase their investments in AI and machine learning over the next two years. Importantly, 93% of those surveyed intend to use AI to enhance their operations and manage risk, rather than replacing staff with automation.

Employee shortages are common in compliance, leading to heavy workloads and burnout, especially in level one teams. Many organisations face capacity challenges, with smaller ones often relying on senior staff to fill the gaps. Filling experienced compliance analyst roles takes time, with onboarding and training further extending the process. Employee retention issues put additional pressure on the remaining staff and impact compliance operations.

Efforts to ease the workload for compliance analysts include screening analytics, staff augmentation, specialised consultants, and leveraging technology. If they had more capacity, organisations would focus on improving risk monitoring, pursuing more revenue, shortening account opening times, and increasing their risk appetite. Cost containment is not a priority.

The survey also revealed that most organisations plan to increase their AI and ML investments, with many seeing regulatory action and staffing challenges as strong motivators for adopting automation technology. AI is seen as a valuable tool to boost compliance, not a threat to jobs in the industry.