The move to a risk-based approach to anti-money laundering regulation has yielded little fruit, according to new research.
Last year the Financial Services Authority (FSA) replaced its existing money laundering rulebook with a set of risk-based guidelines.
By doing this the regulator sought to lower the cost of complying to money laundering rules, but according to a survey conducted by accountant PricewaterhouseCoopers (PwC), 82 per cent of financial institutions have not noticed any cost benefits.
Meanwhile, almost 10 per cent of institutions have not yet complied with the new rules, which could lead to a legal minefield.
PwC partner Andrew Clark said progress still needs to be made at a time when there has never been greater pressure on financial institutions to ensure their anti-money laundering controls are fit for purpose.
“It’s critical to address the efficiency of anti-money laundering systems,” explained Clark. “Many are proving inadequate at identifying potential abusive transactions.”