As financial services firms continue to modernise their compliance operations, many are recognising that legacy, manual approaches are no longer suited to today’s escalating regulatory expectations.
Although automation is gaining momentum across the industry, a substantial portion of organisations still rely heavily on spreadsheets, email chains and periodic reviews. In an environment where customer and market risk can shift rapidly, static oversight creates operational blind spots, said KYC360.
A recent poll of compliance professionals in Jersey offered a snapshot of how firms are currently approaching risk control. Screening appears to be the most advanced area, with 77% of respondents automating sanctions and PEP checks daily. Yet 23% still conduct these processes manually or infrequently, which introduces exposure when sanctions lists change at pace. The findings also point to a need for firms to redeploy skilled analysts away from repetitive, low-value activity so they can focus on deeper investigations that directly align resources to risk.
Onboarding processes reveal further inefficiencies. According to the poll, 79% of organisations still collect client information via email or PDF documents. This creates bottlenecks that delay time to revenue and heighten the risk of input errors. For ultimate beneficial ownership (UBO) verification, 71% depend on declarations or certified documents, and only 8% use integrated KYB or registry feeds. Meanwhile, 89% manually update structure charts, adding to operational strain and increasing the potential for outdated or inaccurate data.
Risk assessments also lag behind. While screening tools have matured, 42% of firms continue to rely on spreadsheets for risk scoring, and fewer than 10% assess risk dynamically. This makes it difficult to react to changes such as ownership shifts, new regulatory rules, or jurisdictional risks that emerge between review cycles.
The broader regulatory landscape reinforces the need for a risk-based approach. Firms must match oversight to customer risk profiles, not only to avoid fines or reputational harm but also to support sustainable growth. Static reviews cannot keep pace with shifting circumstances, meaning organisations must transition to continuous monitoring to remain ahead of increasingly sophisticated criminal behaviour.
The Formula 1 analogy illustrates how data-driven oversight can transform outcomes. Historically one of the most dangerous sports in the world, F1’s approach changed dramatically after the death of Ayrton Senna, when the sport invested heavily in real-time telemetry, predictive modelling and constant engineering refinement. Since 1994, only one driver has died during a race, even as lap speeds have increased. The lesson is clear: rigorous risk control does not hinder performance—it enables it.
Financial institutions can apply similar principles. Real-time monitoring allows firms to detect unexpected changes, such as shifts in ownership or control, long before periodic reviews would flag them. Predictive analysis supports early detection by identifying warning indicators such as adverse media trends or behavioural signals. Continuous refinement, guided by historic insights, strengthens models over time, particularly in highly regulated environments. AI-driven automation also reduces the burden of manual workloads, enabling teams to move past outdated assumptions—much like McLaren’s decision to pursue an unconventional pit strategy that secured a competitive edge.
Cultural change is equally important. As in F1, where innovations like the halo device faced initial resistance, compliance transformation requires psychological safety, collaboration and openness to experimentation.
KYC360 embodies this digitised, risk-based approach through its Customer Lifecycle Management platform. The solution unifies onboarding, ongoing assessments and automated periodic reviews to create a connected view of customer risk. Key features include real-time dashboards, event-driven workflows, instant reaction to changing risk profiles, modelling tools that show how rule changes will impact outcomes, granular access permissions and the ability to run multiple risk models concurrently. Firms can also track diverse risk types in real time, visualise complex ownership structures and streamline outreach without unnecessary data rekeying.
Risk management has progressed far beyond spreadsheets and infrequent reviews. Organisations embracing continuous, data-driven oversight are better positioned to make faster, more informed decisions—enabling stronger compliance and a clearer path to growth.
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