Financial Crime World

Financial Institutions in Chad Must Combat Money Laundering Amid Growing Regulatory Demands

In a world where financial crime regulations are constantly evolving and new rules are being implemented, Chadian financial institutions must take extra steps to remain compliant. Since 2008, fines imposed for money laundering and sanctions violations have reached a staggering $28 billion, with tier one banks spending around $1 billion annually on financial crime operations.

Key Controls to Prevent Financial Crime

Financial institutions in Chad must implement effective Know Your Customer (KYC), screening, and Anti-Money Laundering (AML) monitoring and investigations controls. However, these processes often struggle with efficiency and effectiveness, relying on outdated technologies and manual tasks that can lead to significant compliance risks.

Effective Controls to Prevent Financial Crime

  • Implement robust KYC procedures to verify customer identities
  • Utilize advanced screening tools to identify high-risk customers
  • Develop a comprehensive AML monitoring system to detect suspicious transactions
  • Conduct regular investigations to ensure compliance with regulatory requirements

New EU Rulebook: A Game-Changer for Financial Institutions

The European Commission’s action plan to strengthen the EU’s framework against money laundering and terrorist financing proposes significant changes to the current legislative and supervisory framework. If implemented, these measures will require financial institutions in Chad to reassess their operations and adapt to a new rulebook.

Key Changes in the New EU Rulebook

  • Enhanced customer due diligence requirements
  • Strengthened AML reporting obligations
  • Increased transparency in beneficial ownership structures
  • Improved cooperation between regulatory bodies

AI-Powered Solutions for Financial Crime Prevention

Artificial intelligence (AI) can drive significant efficiencies in operational hotspots such as customer due diligence, screening, and transaction monitoring controls. By introducing machine learning techniques, AI can reduce false positive alerts and operational workloads, making it an attractive solution for financial institutions in Chad.

Benefits of AI-Powered Solutions

  • Improved accuracy in risk assessments
  • Enhanced efficiency in KYC processes
  • Reduced operational workloads
  • Increased transparency in AML monitoring

The pandemic has triggered unprecedented change, forcing lifestyle adjustments and turbulence in financial markets. Financial institutions in Chad must consider the impact on operations, employees, and customers while remaining compliant with key KYC, AML, and Sanctions obligations.

Mitigating Risks During the Pandemic

  • Carefully evaluate client risk-rating decisions due to disruptions in KYC processes
  • Recalibrate financial crime monitoring processes and systems to the “new normal”
  • Transition to or increase reliance on digital onboarding solutions to minimize customer onboarding disruptions