What could go wrong if a platform isn’t secure?
Running an anti-money laundering and countering financing terrorism (AML/CFT) program involves vast amounts of data – that’s why more and more businesses are using third-party software solutions to manage compliance. This type of software gives businesses a way to meet regulations and protect their financial security, without having to invest so much time and energy into the process.
While this takes a lot of pressure off an organisation, trusting sensitive client information to an outside provider does come with its own risks.
Awareness is key – here’s what you need to know:
1. Cloud threats
61% of all businesses migrated their workloads to the cloud in 2020, and AML/CFT software providers are no exception. Cloud solutions can help businesses cope with increasing volumes of transactions, they tend to have leaner on-site IT teams and they can make it easier to keep up with changes to technology or regulations. However, because cloud tech increases some risks, it’s important to choose a provider with robust security standards.
Key threats include:
- Cyberattacks and data leakage – data in transit is particularly vulnerable to cybercrime, which can lead to sensitive and valuable data being exposed or held to ransom.
- Regulatory violations – data protection regulations (like the New Zealand Privacy Act) require organisations to comply with specific rules around what information can be collected and who can access it. Cloud systems tend to make access easy, which can be an issue if you need to lock down certain types of data.
- Loss of data – data stored in the cloud is just as vulnerable as data stored on-premise. Things like accidental deletion by the service provider, power outages or natural disasters are all real possibilities.
2. The human factor
While automation and the use of software reduce the amount of human interaction with AML/CFT programs, compliance officers will still have access to sensitive customer data. Human error, lack of training or malicious intent are all risks – whether your program is outsourced or managed in-house.
3. The importance of partnering with a trusted provider
AML/CFT compliance requires businesses to collect and store sensitive customer information and meet regulations set out in the AML/CFT Act. Third-party software solutions streamline this process for businesses – but not all providers are created equal. It’s essential to choose a vendor that puts security front and centre.
First AML is a good example. Our data security processes are second-to-none, designed in accordance with the international information security standard ISO27001. We’re dedicated to keeping our standards high with ongoing testing and training to ensure that your customers’ private data remains just that – private. Get in touch today to find out more.