Banking
4 Challenges Your Bank Must Overcome to Effectively Combat Financial Crime
One frightening reality that bank executives may have a hard time accepting is that, with the advent of technology, their institutions are becoming increasingly vulnerable to financial crime.
It isn’t just an issue of money launderers, terrorist backers, and other malicious agents running rife in these times of economic precarity. Such actors are also getting even better at their game, and the structural defenses that banks may have used against them in the past are no longer sufficient. When all that is added to the general difficulty of modernizing a bank’s anti-money laundering (AML) system and meeting the demands of its AML regulators, protecting an institution against financial crime seems like a weighty task indeed.
But on the issue of keeping your bank’s assets safe from the taint of criminal activity, there’s no way to go but up. With every year that passes, your bank should be able to strengthen its AML compliance, case management, and transaction monitoring processes. The goal is to evolve faster than criminal agents’ methods and to make sure that your data and monetary assets remain safely out of their reach.
Below are four challenges that you should overcome to be at an advantage when combating financial crime. Address these issues now and avoid the risk of being permanently compromised by criminal activity.
The Limitations of Your Current AML and Financial Crime Compliance Management Systems
You may not realize it, but one of your biggest obstacles to forming a full response to financial crime is your legacy AML compliance system.
If it’s been a long time since you updated your bank’s tech stack for AML functions, your institution is particularly vulnerable to threats. Savvy criminals can take full advantage of slow, siloed-off, delay-ridden, and case-congested AML structures. Indeed, these malicious individuals can wreak significant damage to a bank by exploiting an outdated system’s weaknesses.
If you want a fighting chance against financial crime, it’s in your best interest to upgrade to a consolidated AML solution that runs on the cloud. Having an overarching platform for AML will get your bank up to speed in terms of real-time transaction analytics, visibility over your customer enrollments, and coordination among stakeholders in your AML investigations. Upgrade as soon as possible so that there’s little legroom for financial criminals to move around in.
Increasingly Complex Schemes from Money Laundering Networks
The second challenge that you must address is your understanding of how money laundering networks and other criminal rings currently operate.
Too many banking execs still envision financial crime to play out just like it does on TV: in an obvious and predictable manner. But in truth, most criminals have adapted their methods to be even more sophisticated and undetectable to the naked eye. Over the years, they have become even better at covering their tracks and disguising their movements to look like those of legitimate customers.
An institution cannot be too complacent about keeping up with criminal trends and connecting its systems to the news, international watchlists, sanction lists, and lists of politically exposed persons (PEPs). You and your team should stay on your toes and pay careful attention to any anomalies that occur in your system—not only for individuals but also for patterns or webs of suspicious customer behaviour.
Inefficient Approaches to AML Case Management
A third issue that may stand in the way of nipping criminal activity in the bud is your bank’s piecemeal approach to AML case management and investigation work.
If your bank relies on a case management method of simply segregating the false positives from cases of legitimate concern, it could spell your financial institution’s doom. In the long time that it takes to review individual cases and flag them one by one, you may have already been significantly compromised by the false negatives.
Because of this, make it a point to rethink your AML case management strategy to be quicker, less overwhelmed by congestion, and more efficient with your investigators’ attention. Again, there’s value in employing a pattern-based crime detection system and training your staff to look at both cases of concern and webs of suspicious activity, as certain cases in these groups may ultimately be related. This approach will also help investigators zero in on cases of alarm and resolve them with greater speed and accuracy.
Deficiencies in the Audit and Compliance Trail
It’s never easy to keep a paper trail for AML audits and other efforts toward full financial crime compliance. That said, it’s housekeeping work that banks urgently need to do. Without organized and updated systems for tracking AML governance and transparency, a bank will stay in the dark about just how effective its AML system has been over the years. Needless to say, it may falter when it’s time to submit to its regulators—or, worse yet, when actual criminals come knocking.
Your bank shouldn’t be remiss in compiling its documentation work and keeping financial crime compliance reports. Be up to date about the performance of your AML system and which aspects of it require technological or operational improvement.
Bolstering Your Bank’s Defenses Against Threats of Financial Crime
Steering clear of financial crime shouldn’t be a matter of luck for your bank. You must be purposeful in your efforts to strengthen its defense against criminals and its compliance record with your regulators. Even if you don’t envision your institution as an easy target for criminal networks, you never know when they may attack. What matters is that you’re prepared and that your assets are sufficiently protected when—not if—your bank becomes their next target.
By Modupe Gbadeyanka
About N3.6 trillion has been repaid to the Central Bank of Nigeria (CBN) by the Asset Management Corporation of Nigeria (AMCON) since its inception in 2010.
This information was revealed by the chief executive of AMCON, Mr Gbenga Alade, during a media parley to update the press on the activities of the agency.
Mr Alade said at the moment, the organisation still owes the central bank about N3 trillion for toxic assets of banks in the country.
He praised the organisation for its asset recovery drive, stressing that when compared with others across the world, Nigeria has done well.
“It is important to stress that the corporation has done tremendously well, especially when compared to other notable government-owned Asset Management Corporations around the world.
“Based on the balance at purchase, AMCON outperformed other Asset Management Corporations all over the world by achieving over 87 per cent in recoveries despite the unique challenges associated with debt recovery in Nigeria.
“The Malaysian Danaharta, which is adjudged one of the best performing Asset Management Corporation’s, only achieved 58 per cent. The Chinese Asset Management Corporation, despite its stricter laws, achieved just 33 per cent.
“Only the Korean Asset Management Corporation (KAMCO), South Korea, has achieved more recoveries than AMCON, with about 100 per cent. This was due to their brute force with which they chased the obligors.
“Despite KAMCO’s recovery records, the agency is still operational to date with slight realignments in its mandate.
“Other noted Asset Management Corporations that have transitioned into a perpetual institution of the various governments include, China Asset Management Company, Federal Deposit Insurance Corporation (FDIC) USA, and KFW Germany.
“So, gentlemen, without sounding immodest, AMCON has done well, and we will not relent until all the outstanding debts are fully realized,” Mr Alade stated.
On the financial performance of AMCON, he said last year, the firm posted a revenue of N156.25 billion and operating expenses of N29.04 billion, while for the 2025 fiscal year should be a revenue of N215.15 billion and operating expenses of N29.06 billion.
By Modupe Gbadeyanka
One of the non-interest banks in Nigeria, The Alternative Bank (AltBank), has opened a new branch in Effurun, Delta State.
The new office will serve the Edo-Delta region and provide purposeful banking and real financial empowerment for individuals, entrepreneurs, and businesses, a statement from the firm stated.
The lender disclosed that the Effurun branch is a bold move in its mission to reshape banking in Nigeria.
The launch was graced by key dignitaries, including the Ovie of Uvwie Kingdom, Emmanuel Ekemejewa Sideso Abe I; the Chairman of Uvwie Local Government, Anthony O. Ofoni, represented his vice, Andrew Agagbo; and the Special Adviser to the Governor of Delta State on Community Development, Mr Ernest Airoboyi; amongst others.
The Divisional Head for South at The Alternative Bank, Mr Chukwuemeka Agada, emphasised the institution’s commitment to Warri and its surrounding communities.
“By establishing a presence here, we are initiating a transformation in the way banking serves the people of Delta. Our purpose-driven approach ensures that customers’ financial goals are not just met but exceeded,” he stated.
“This branch represents our pledge to empower Warri’s dynamic businesses and families, providing them with the tools to grow without compromise,” Mr Agada added.
“We understand the heartbeat of this community, and we are excited to integrate our bank into the fabric of this dynamic region,” he stated further.
On his part, the representative of the Ovie, Mr Samuel Eshenake, challenged the bank to facilitate development and employment within the Effurun community.
The Regional Head for Edo/Delta at The Alternative Bank, Mr Akanni Owolabi, embraced this challenge, pledging that the bank will work sustainably to drive local commerce.
“At The Alternative Bank, we are committed to being an active partner in the development of Effurun. We see this branch as a catalyst for creating opportunities, driving employment, and supporting the growth of local businesses.
“Our mission is to empower this community, ensuring that every step forward is one of progress, prosperity, and shared success.”
By Aduragbemi Omiyale
A partnership aimed to enable seamless, real-time and secure transactions for cardholders across Africa and the rest of the world has been entered into by Payattitude and PAPSSCARD, the card scheme initiative of the Pan-African Payment & Settlement System (PAPSS).
The collaboration will allow Payattitude cards issued by banks and other deposit-taking institutions to be co-branded with PAPSSCARD, Discover, Diners and Pulse for acceptance across their networks in Nigeria, Africa and worldwide.
As an initiative of the African Export-Import Bank (Afreximbank) and a key financial infrastructure supporting the African Continental Free Trade Area (AfCFTA), the PAPSSCARD scheme will facilitate instant cross-border payments in local currencies.
“This partnership reflects our commitment to cross-enterprise alliances and enabling inclusive, efficient, and borderless payments across Africa and the world
“With Payattitude, Nigerian cardholders and financial institutions can now enjoy the benefits of a Nigerian card that can be used worldwide,” a director at Payattitude, Dr Agada Apochi, said.
The acting chief executive of PAPSSCARD, Mr John Bosco Sebabi, said the aim is “to connect African payment ecosystems, reduce the cost and inefficiencies of cross-border payments, and strengthen African sovereignty over payments infrastructure.
“Collaborating with Payattitude, a key innovator in Nigeria’s payment space, represents a significant step towards a more unified African payment landscape.”
The chief executive of PAPSS, Mr Mike Ogbalu, said, “By bringing together PAPSSCARD’s robust cross-border payment capabilities with Payattitude’s leadership in the Nigerian digital payments, we are taking tangible steps toward building a single African market where individuals and businesses can transact easily and securely, both within and beyond Africa.”
Payattitude is the first-in-kind Nigerian Payment Scheme to pioneer multibank App and USSD Code *569#.
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