Retail bank implements new technology to monitor money laundering activities

Hot from the research and development labs at SAS in the US, the newly launched SAS Anti-Money Laundering (AML) solution is already making its mark in the Europe, Middle East and Africa (EMEA) region. A leading retail bank in Saudi Arabia has become the first bank outside North America to implement this cutting-edge AML technology.

Says Steve McTigue, consultant for SAS Institute SA and senior project manager on the implementation of SAS AML at the Saudi Arabian bank: "Not only is the bank first in implementing the generic SAS AML solution outside the US, but it is also the first financial institution to be fully compliant with Saudi Arabian AML legislation, which is aimed at the prevention of terrorist financing activities as well as money laundering in that country."

The project - a collaborative effort between SAS's offices in SA, the Middle East, Europe and the US - demonstrated the company's ability to tap into its global expertise and resources to successfully fast-track implementation projects of this size and complexity in record time.

According to McTigue, the project was initially proposed with a four- to Six-month timeline but the client, under pressure to comply with AML regulations, wanted the system implemented as soon as possible.

"A dedicated task-team, comprising highly-trained SAS consultants and some bank employees, was commissioned to manage the process, with the result that the project was successfully completed within three months.

"The project was split into two phases, with the first phase focusing on building a data warehouse and implementing the generic AML application as quickly as possible. The second phase involved enhancing and customising the solution to suit the client requirements so that it could add value," he explains.

Using SAS AML, which is a specially packaged solution to assist the banking industry with AML reporting regulations, the bank will be able to monitor suspicious transactions, identify patterns of behaviour and report possible money cleansing activities on a daily basis.

McTigue says SAS has long been established as the leader in the information delivery industry and it has the underlying technology to support it. However, he stresses that technology does not implement itself and that without teamwork, the project would not have been as successful.

"Throughout the project, there was continuous interaction with the research and development team at the SAS headquarters in Carey, US. Whenever we hit a snag, we were able to leverage SAS's skills and resources across geographies to overcome it," he explains, adding that strong commitment from the client to aggressively driving the implementation is imperative.

"I reported directly into the chief compliance officer at the bank and I believe that corporate ownership of the project at the highest level is necessary to successfully complete a project of this nature within deadline," he says.

Another factor that contributed to the success of the project was the implementation team's ability to quickly install the application and then focus on modifying it to suit the environment.

At this stage, understanding the banking environment and the culture of customers in Saudi Arabia became very important. This was because SAS AML had been developed with US reality in mind, and patterns and transactions can be interpreted differently in other countries. For instance, multiple ATM transactions in one day might be interpreted as suspicious in the US but in the Saudi context might not be unusual.

"SAS AML technology has the flexibility to hone to the customer's behaviour and we were able to manipulate thresholds to allow the bank to use the system in a sensible way for its own environment," he explains.

Looking ahead, McTigue believes the demand for the SAS AML solution will increase as financial institutions and banks worldwide are forced to comply with AML legislation.

"This project is proof that SAS AML has the ability to adapt to the different banking environments in each country. It was a fascinating learning curve and the experience gained in Saudi Arabia will stand us in good stead for similar projects in the future," he concludes.