Why is there a rising demand for Anti-money Laundering Specialists?

The estimated size of the global anti-money laundering software market in 2021 was 2.8 billion dollars, and it is anticipated to reach around 7.4 billion dollars by 2030, with a CAGR of 11.4% from 2022 to 2030.

The financial services and accounting industries underwent a great deal of change as a result of the 2008 recession, from completely new regulations to the revision of old ones. Since then, the field of compliance has experienced rapid growth, and many financial services employers struggle to find qualified compliance professionals due to the sudden emergence of this need across the entire industry. Let us know why is the need for anti-money laundering specialists increasing.

Who is an Anti-money Laundering Specialist?

A specialist in the prevention, identification, and investigation of money laundering activity is known as a certified anti-money laundering specialist (CAMS). Criminals use money-laundering schemes to hide the origin of funds acquired through unlawful means.

AML KYC Specialists pursue careers in both the public and private sectors after becoming certified. Many people who hold the certification work in the financial services industry because of the important role it plays in preventing money laundering. Additionally, certified individuals are valued by accounting firms (such as the “Big Four”: Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young (EY), and KPMG), particularly in relation to their forensic accounting practices.

What makes AML crucial for businesses?

With the advent of new, diverse technologies and digitization, criminals are now looking for creative new ways to commit crimes. Due to the rise in financial crimes, institutions now have an even greater need to invest in appropriate technology and adhere to regulations. According to the United Nations1, the annual value of money laundering is estimated to be between two and five percent of the global GDP, or roughly $800 billion to $2 trillion. As there are more opportunities for money laundering and more financial crimes, regulators like the FATF, IMF, and national governments have stepped up oversight and legislation.

These factors compel businesses, including banks, capital markets, other financial institutions, retail, eCommerce, and public sector organizations, to implement anti-money laundering programs that include manual investigations and technological frameworks to monitor transactions, clients, and their networks, and spot suspicious activity. The massive digitization of financial activities makes it difficult for manual investigators to operate at a larger scale, though. Thus, for intelligent alert prioritization, advanced analytics, anomaly detection, client risk ranking, trade transaction life cycle, and proper regulatory compliance, these organizations must adopt effective AML technologies that make use of data and analytics.

Why is the need for anti-money laundering specialists increasing?

A financial institution’s systems are typically monitored by an anti-money laundering specialist to detect any suspicious transaction activity and make sure that regulatory requirements are being followed. The Bank Secrecy Act and its implementing regulations (the “AML rules”) must be followed by businesses, according to the Financial Industry Regulatory Authority (FINRA). The goal of the AML regulations is to assist in the detection and reporting of suspicious activity, including the precursor crimes to money laundering and terrorist financings, such as market manipulation and securities fraud.

It is understandable why there is such a high demand for AML professionals at this age due to security worries. It’s crucial for those trying to enter the field to educate themselves in forensic accounting, statistical data mining, and risk management. Additionally, obtaining the AML KYC specialist certification and becoming a Certified Anti-Money Laundering Specialist is always beneficial. Here are some reasons for the growing demand for AML Specialists-

Increasing financial crimes

The main drivers of the growth of the global AML market are the increasing prevalence of financial crimes, financial institutions’ increased focus on digital payments, and stricter anti-money laundering regulations and compliances. During the forecast period, demand for AML software is anticipated to be boosted by the increasing use of analytics in anti-money laundering and the increased focus on incorporating cutting-edge technologies like artificial intelligence, machine learning, and big data into the development of AML software.

Strict Government Regulations

One important factor that significantly influences the adoption of AML software among financial institutions around the world is the strict government regulations pertaining to non-compliance with AML regulations that may result in sanctions, financial penalties, and reputational losses. Examples of laws to control money laundering and financial crime activities include the Financial Industry Regulatory Authority (FINRA), the Australian Transaction Reports and Analysis Centre (AUSTRAC), and China’s Banking and Insurance Regulatory Commission (CBIRC). Various regulations have been put into place and changed in numerous countries around the world due to the rising number of financial frauds. The regulations are complicated because they cover even the smallest instances of money laundering.

The growing use of AML Solutions

The demand for AML software has increased due to the growing use of AML solutions like KYC and CDD to ensure that their customers are not engaged in any money laundering activities. According to Comply Advantage, the total AML fines from January to April 2019 were approximately US$7.7 billion worldwide. Around the same time, the US fined Standard Chartered approximately US$947 million. The global uptake of AML software is being boosted by the rising financial penalties for non-compliance.

Increasing your marketability

Here are some suggestions for increasing your marketability, particularly if you lack prior experience or education:

• Look for transferable experience and skills to highlight on your resume and in interviews if you have previous experience in accounting or financial services, such as prior compliance work with some firms and other pertinent laws and regulations.
• A career in AML also requires a lot of report writing, so make sure to highlight your communication and writing abilities as well as any prior analytical and research experience you may have.
• Consider telling your employer about your interest in the field and requesting more exposure to the company’s AML practices if you already work there. This could be a great way to enter the field while continuing to work for your current employer if your company has current AML needs.
• Find a temporary position as an AML Analyst or another comparable position. The experience needed to land a long-term position with a reputable company in the future can be obtained through temporary employment very effectively.
• Join a LinkedIn group for AML to read about, discuss, and stay current on the sector. If you can, network with other industry professionals. In your LinkedIn summary, mention your desire to enter the industry.

Last Words

A significant risk of money laundering exists with the rise of cryptocurrencies, digital assets like NFTs, and the world of decentralized finance. The system’s extreme lack of regulation creates a number of new opportunities for money laundering activities. According to a report by leading blockchain data platform, the amount of money laundered through cryptocurrencies reached $8.6 billion in 2021, up 30% from the year before. Hence, a career in this field is worth it!