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AML risk: The evolving role of compliance in modern banking
As regulation evolves and financial crime grows more complex, governance and technology are becoming key drivers of resilience
- PUBLISHED: Tue 30 Jun 2026, 7:30 AM
Financial institutions today are expected to do far more than meet regulatory requirements. They must protect customer trust, anticipate emerging risks, embrace new technologies, and maintain strong governance while continuing to innovate. That has elevated compliance from a behind-the-scenes function to one that increasingly influences business strategy and long-term resilience. Drawing on more than three decades of experience in banking, risk management, and financial crime compliance, AbdulSalam Moosa, Senior Manager Compliance and MLRO at Siraj Finance, discusses how the profession is evolving, the biggest AML challenges facing institutions today, and why culture remains just as important as regulation.
How has the role of compliance shifted from a control function to a strategic business enabler within financial institutions?
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The evolution of the compliance function has been both necessary and overdue. For many years, compliance was perceived primarily as a gatekeeping function, one that slowed decision-making and introduced operational friction. That paradigm has fundamentally changed. Today, regulators across the globe, expect compliance to have a seat at the strategic table rather than operate solely as an independent control function.
Over my 30+ years in the industry, I have witnessed compliance transforming from a reactive, checklist-driven discipline into a forward-looking function that actively influences product development, market expansion, business conduct, governance frameworks, and risk management strategies.
What are the biggest financial crime and AML risks facing financial institutions today, and how can organizations strengthen their defences against them?
The financial crime landscape has become increasingly diverse and sophisticated, driven in part by technological advancements and the evolving tactics of criminal networks. Among the most significant risks financial institutions facing today are trade-based money laundering, proliferation financing, misuse of correspondent banking relationships, sanctions evasion, and AI-enabled fraud, including deepfake identity manipulation and the use of synthetic documentation. These threats are particularly challenging for institutions operating across multiple jurisdictions with complex customer and transactional ecosystems.
Strengthening defences requires organisations to move beyond conventional, static, rules-based controls and adopt a more dynamic, risk-based approach.
How are technologies such as AI, automation, and advanced monitoring tools transforming compliance and regulatory reporting?
AI, automation, and advanced analytics are no longer optional enhancements; they have become operational imperatives. The volume of regulatory change, coupled with increasingly sophisticated financial crime typologies, makes manual compliance processes both operationally and financially unsustainable at scale. In practice, AI-driven transaction monitoring has significantly improved efficiency by reducing false positives and enabling compliance teams to focus their expertise and judgement on genuinely high-risk cases. Automated regulatory reporting solutions have enhanced accuracy, consistency, and audit trail integrity. Within banking institutions, intelligent technologies are also strengthening compliance oversight across extensive product portfolios and complex customer relationships, areas that traditionally relied heavily on manual review.
What are the critical elements required to embed compliance, ethical conduct, and accountability across all levels of an institution while still supporting business growth and innovation?
Policies and frameworks provide the foundation, but culture determines whether compliance becomes an integral part of daily decision-making or remains merely a documented requirement. An effective culture of compliance begins with a visible and consistent tone from the top. Leadership commitment must be demonstrated through consistent actions, with accountability frameworks applied fairly and uniformly across all levels of the organization. Compliance training must also be practical, relevant, and tailored to the specific risks faced by employees, rather than relying on generic awareness programmes. Employees should understand not only what is required but also why it matters. In Islamic banking, there is a distinct advantage. The ethical foundations of Shariah principles naturally align with many regulatory objectives, creating a strong framework for responsible conduct.
The challenge lies in translating those principles into consistent operational discipline across the organisation. To achieve this, incentive structures should include ethical behaviour and sound risk management alongside commercial performance.