Less than 5% of Romanian companies use AML solutions

• The share of companies implementing AML solutions in Romania will reach 8% – 10% in 2023

• The biggest investors in AML solutions are financial-banking institutions, insurers, developers and real estate agents, crypto trading platforms, lawyers, public notaries and gambling operators

• Globally, more than half of the companies were defrauded, in the last 2 years, and most of them suffered financial losses

Bucharest, August 30, 2023 – Less than 5% of Romanian companies currently use AML solutions to prevent money laundering and terrorist financing, according to an analysis by the Romanian company Qoobiss, the developer of the Qoobiss AML solutions, which supports companies in the financial sector to automate the verification and monitoring of individuals and legal entities, in order to establish compliance risk. The Qoobiss company is also known in the local market for the fully automated Qoobiss Identify solution, which offers a secure and digitized identity verification process.

The share of companies implementing AML solutions will accelerate in the coming period, rising to 8% – 10% at the end of 2023. In the last year, the incidence of digital fraud has increased, as companies invest in the development of online activity and generate an increased volume of online transactions and digital payments. Globally, more than half of the companies have been defrauded in the last 2 years, with 53% of them recording financial losses as a result of the frauds they faced. The situation in Romania is similar“, says Ileana Comănescu, KYC Global Product Manager at Qoobiss.

According to the “Global Economic Crime and Fraud Survey 2022”, conducted by PricewaterhouseCoopers (PwC), almost 4 out of 10 companies with global annual revenues below 100 million dollars have been defrauded in the last two years.

In this situation, combined with the sanctions imposed on Russia, which include commercial and economic restrictions, bans on imports and exports, limitations on banking transactions, travel restrictions, etc., companies become much more careful with who they collaborate with, to whom they provide services and products and they want to know their customers better in order to prevent their services from being used for illegal activities and to protect the integrity of financial systems.

The Qoobiss AML solution was launched last year in September, and we currently have 15 customers. We estimate that by the end of the year we will increase the customer portfolio by approximately 30%“, says Ileana Comănescu, noting that, since the launch of the solution, the companies that have implemented this type of service are part of the financial and gaming industries, recently concluding a contract with an insolvency industry partner.

Currently, in Romania, according to the legislation in force, only banking institutions have the obligation to verify the identity of customers, as well as to monitor them throughout the contractual period. But the implementation of AML solutions helps companies not to be defrauded and, at the same time, to comply with the law and reduce the criminal phenomenon.

In the next period, according to Qoobiss, the biggest investments in the implementation of AML solutions will be made by:

• Banks and other financial institutions – these are the biggest users of AML solutions, as they are exposed to high risks of money laundering and terrorist financing;

• Insurance companies – use AML solutions to prevent and combat insurance fraud and other illegal activities;

• Real estate developers and agents – due to exposure to high risks of money laundering through real estate transactions – AML solutions can prevent such illegal activities;

• Cryptocurrency trading platforms – these platforms must comply with AML regulations to prevent and combat money laundering in cryptocurrency activities;

• Lawyers and public notaries – may be engaged in complex financial transactions involving money laundering and terrorist financing risks;

• Gambling operators – they have a high exposure to money laundering risks through gambling transactions, so it is important to use AML solutions to prevent such illegal activities.

AML tools refer to the laws, regulations and processes that make it more difficult for criminals to attempt to hide the origin of ill-gotten funds acquired through crime, drug trafficking, tax evasion, fraud, terrorist financing or corruption. To prevent attempts to move money through financial institutions or legitimate businesses, companies are responsible for monitoring and reporting suspicious transactions. Regulated institutions can face substantial fines and other consequences for non-compliance with AML regulations.

What does Qoobiss AML do?

The Qoobiss AML solution for verification and monitoring of individuals and legal persons in order to determine compliance risk is a REST API service that allows the verification and monitoring of entities established by the beneficiary in all international sanctions lists as well as publicly exposed persons (PEP). For Romania, mandatory checks are made in two international sanctions lists: that of the European Union and that of the United Nations Security Council.

The solution allows verification and monitoring from multiple perspectives: persons and companies subject to international sanctions, publicly exposed persons, relatives and close relatives of publicly exposed persons, persons and companies subject to restrictive regulations from local or international authorities, exposed persons and companies from the point of view of reputational risk, persons and companies with profiles that may represent a risk, state-owned companies and persons pursued by the Romanian Police.

International sanctions lists and lists of persons pursued by the Romanian Police verified by the Qoobiss AML solution are updated in real time.