Building society installs anti-money laundering tech

Newcastle Building Society is about to implement an anti-money-laundering (AML) system to comply with FSA regulations and ensure quality of service to third parties.

The building society currently carries out transaction monitoring and exception reporting, which requires staff to check and compile reports. According to Newcastle Group financial crime manager David Moore, this activity was sufficient up until a few years ago, when the building society branched out into offering a savings account platform for third-party financial services companies.

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The society now has assets worth £4.4bn and like all banks is a potential target for fraud and money laundering. Reports to third parties could take up to six weeks to compile.

Moore said: "As we grow, it would be impossible to meet new challenges without deploying a lot more resources."

The AML system, called Amlock and provided by 3i Infotech, automatically generates reports and sends an alarm to the staff member who is responsible for taking care of that particular type of anomaly.

As part of the benefits the system brings, Moore said he expects to not have to employ any more staff to cover the acquisition of at least two new third-party customers.

As well as improving its services, the building society is anticipating new money laundering regulations from HM Revenue & Customs.

On 15 December, money service businesses will have to demonstrate they are monitoring the transactions they undertake and keep up-to-date records of those transactions.

Failure to do so might result in a fine or a prison sentence of up to two years, if money laundering is found to have taken place.