Ongoing monitoring: What do you need to know?
Ongoing monitoring is a process used by accountancy firms to regularly review, update and enhance client due diligence (CDD) and risk assessments.
For anti-money laundering (AML) compliance purposes, the objective of ongoing monitoring is to ensure all CDD is thorough and current.
Customer due diligence
CDD means taking the steps to identify your clients and checking they are who they say they are. In practice this means acquiring a customer’s:
- Residential address and date of birth
- Photograph of an official document which confirms their identity (a passport or driving license)
A firm is required to keep a record of all CDD measures that they carry out, including:
- Client identification documents
- Risk assessments
- Training records
- Your policies, controls and procedures
By keeping comprehensive records, a firm can show they are complying with Money Laundering Regulations. It is important to protect your business if there is an investigation into one of your clients.
Firms employ ongoing monitoring to detect if customer transactions are aligned with their expected patterns, based on the knowledge of the client, including their business and risk profile.
For example, when creating a new customer, a firm would determine the average monthly processing capacity and the expected transaction volume. Throughout the customer’s time with the firm, their transactions are continuously monitored against these expectations.
Many firms look to automate the monitoring process, and if a customer fails to meet the expected transaction patterns, there would be changes in their politically exposed person (PEP) status and sanctions.
Automating systems can help to streamline the monitoring process and ensure that it is done accurately and consistently.
FibreCRM’s onboarding process includes an ongoing monitoring feature. This enables you to save time by keeping all of your CDD data in one secure place.
This feature of our onboarding solution helps you with:
- Connecting to AML platforms
- Keeping track of PEPs and sanctions
- Annual risk management
Ongoing monitoring is critical for firms to prevent money laundering activities and to protect their reputation. Using automated systems to streamline ongoing monitoring can make accountants’ lives easier by saving precious time and keeping information all in one secure place.