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Old 09-07-2021, 09:00 AM
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Hi fellow compliance peers, can anyone explain what is the difference between aml and kyc?

For example, in some banks they have positions for both aml and kyc e.g. A) AML analyst and B) KYC analyst

I spent much of my time sending applications for AML compliance role but was offered a KYC role in a bank instead

Whats the diff between the them and is doing kyc useful for switching into aml compliance role in future?
Based on my understanding, both terms may be used interchangeably, and you should look into the job description to understand the job scope that you'll be doing.

In a general realm of things, Anti-Money Laundering (AML) is a very broad term to represent combating against financial crime. There are several pillars within it such as Sanctions, Anti-Bribery and Corruption, KYC, Tax Evasion, etc. Important to note is that knowing your client (or KYC) is the first and one of the most fundamental requirement, without which, how else are you able to ascertain other risks? For e.g., how do you validate if your client is indeed a sanctioned individual, if the Beneficial Owner has any adverse news or convicted of any criminal wrongdoing) or what attributes of client info (geography, industry, account structure, etc) do you need to ascertain its risk scoring for risk-based assessment?

The job scope would provide further clarity - is it a maker (1LOD) or a checker (2LOD) role? Account opening or client periodic reviews? Are you dealing with BAU operations work or advisory/policy to ensure the FI meets local 626 requirements and banks' global standards?

To your question on the "helpfulness", it depends on what the KYC work entails, your responsibilities and the skillsets achieved. If it's merely a KYC maker role (i.e. obtaining documentation from RM/client and marking it off the checklist/guidelines) - it is less value-adding compared to one that entails reviewing submissions, reviewing potential exceptions and risk-accepting deviations, analysing and escalating to specialist desks for holistic assessment, conducting gap analysing, enhancing framework/policies/projects/processes to strengthen and update the banks KYC/CDD framework.

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