COMPLIANCE AUDIT SERVICES

Our Compliance Audit Service provides financial institutions with an annual, independent assessment of their AML and sanctions compliance framework.

We combine former regulators and seasoned compliance executives with AI-driven diagnostics from the KROTON platform to deliver a 360° view of your compliance effectiveness.

Unlike generic consulting reviews, our approach is both strategic and technical — aligning with regulatory expectations and validating that your systems work as intended.

Bank-grade assessment of Transaction Monitoring, Sanctions/OFAC, KYC/CDD, and models—board-ready in 4–6 weeks. Evidence-based findings and a prioritized remediation roadmap.

OUR SERVICES

We provide 10 different compliance audit services that can be tailored to your needs:

1.⁠ ⁠Full Sanctions Screening Audit: A one-time deep dive to ensure the institution’s entire customer base and transactions are not violating any sanctions. This service runs comprehensive checks against all relevant watchlists (OFAC, UN, EU, and applicable local sanctions lists) and evaluates the effectiveness of your screening systems . With regulators worldwide issuing over $8 billion in sanctions-related fines in the past two years , this audit helps identify hidden risks, tests your matching logic and thresholds, and provides a remediation plan to strengthen sanctions compliance.

2. Correspondent Banking Compliance Readiness: This service prepares banks for the stringent due diligence reviews by current or prospective correspondent banking partners. It assesses your AML/CFT controls against international standards (e.g. FATF recommendations and Wolfsberg Group guidelines) to ensure you are “audit-ready” for correspondent scrutiny. Because correspondent banks have a low risk appetite due to the high sanctions risks they face , our team performs a rigorous internal audit of your financial crime compliance framework . The result is a detailed report and action plan to address any gaps before your correspondent (or their regulators) uncover them.

3. Regulatory (FIU) Examination Readiness Review: A focused mock-audit to get your institution ready for an upcoming inspection by regulators or Financial Intelligence Units (e.g. FINTRAC in Canada, MASAK in Turkey, FMU in Pakistan, BaFin in Germany, FCA in the UK). We simulate an AML/CFT compliance exam, reviewing policies, procedures, samples of alerts and case files, and interview staff to identify weaknesses. Global standards (FATF Recommendation 18) require banks to maintain an independent audit function for AML , and many countries mandate a full program review at least every two years . Our service ensures you meet these expectations by pinpointing gaps in your program ahead of time and recommending fixes so you can face regulators with confidence.

4. Payments & FinTech Compliance Health Check: Tailored for payment service providers, fintech companies, e-money institutions, and money services businesses, this audit evaluates compliance controls unique to high-volume payments and digital services. It covers agent/network oversight, real-time transaction screening, e-wallet monitoring, and compliance with payment scheme rules. These non-bank financial institutions are held to similar standards as banks – for example, U.S. MSB regulations require an independent audit function in the AML program . In an 8-week review, we assess your risk-based controls, record-keeping, and reporting (e.g. international remittances, wire transfers) against local laws and FATF guidance, delivering a report on any compliance gaps and how to remediate them.

5. Comprehensive AML/CFT Program Audit: An end-to-end, independent audit of your entire anti-money laundering and counter-terrorist financing program. We examine all pillars – governance structure, risk assessment, internal controls, customer due diligence, transaction monitoring, sanctions compliance, STR/SAR reporting, and training. The goal is to measure the overall effectiveness and soundness of your program in line with regulatory expectations. According to U.S. examiners, the purpose of independent testing is to assess the bank’s compliance with BSA/AML requirements and the adequacy of its compliance program . Our audit provides board-ready findings with evidence, rates each component’s effectiveness, and outlines a prioritized remediation roadmap to strengthen your framework according to both global best practices and country-specific requirements.

6. KYC and Customer Due Diligence Process Review: A targeted audit of your Know Your Customer (KYC) and Customer Due Diligence (CDD) procedures, from client onboarding to ongoing monitoring. We evaluate how customer risk ratings are determined, the completeness and accuracy of CIP (Customer Identification Program) records, the handling of high-risk clients (e.g. PEPs), and the triggers for periodic reviews or enhanced due diligence . Regulators often penalize institutions for KYC/CDD deficiencies – for example, a major Pakistani bank was fined over Rs114 million for KYC/CDD lapses . This service helps prevent such issues by ensuring your customer profiles, beneficial ownership info, and screening for adverse media or sanctions are all up to standard. We then provide recommendations to close any gaps, customized to your jurisdiction’s specific KYC rules.

7. Transaction Monitoring Tuning & Validation: An in-depth assessment of your transaction monitoring system’s effectiveness. We review your suspicious activity detection rules and models, scenario coverage and logic, threshold calibration, data integrity, and alert handling workflow . Using sample testing and back-testing, we identify where the system might be missing suspicious patterns or, conversely, generating too many false positives. The service not only checks compliance with regulatory expectations on monitoring but also provides optimization suggestions – for instance, adjusting parameters to reduce false positives without missing true alerts (a key efficiency goal for banks) . By the end, you receive a validated set of monitoring controls tuned to your institution’s risk profile and the relevant country guidelines.

8. SAR/STR Reporting & Regulatory Filings Audit: This offering examines the end-to-end process of how you identify, investigate, and report suspicious transactions to authorities (Suspicious Activity Reports or Suspicious Transaction Reports), as well as other required filings (e.g. large cash transaction reports, wire transfer reports). We sample recent cases to see if red flags were properly escalated and if decisions not to file were appropriate. We also review the quality and timeliness of SAR/STR submissions against regulatory standards. Independent audits often evaluate whether the institution’s process for identifying and reporting suspicious activity is adequate, including checking that filed SARs are accurate, complete, and timely . Our team will highlight any weaknesses — such as delayed reporting, insufficient investigation documentation, or missing data — and provide practical fixes so that your reporting fully meets the expectations of FINTRAC, FinCEN, FCA, MASAK, and other regulators.

9. Compliance Governance & Training Assessment: A review of the “soft controls” that underpin an effective compliance program. This service assesses your governance framework (board and senior management oversight, the role of compliance officers, reporting lines) as well as the culture of compliance and training efforts within the organization. We look at whether compliance responsibilities and reporting to the board are clear, how issues are tracked and remediated, and whether your training program is risk-based and reaching the right staff. According to best practices, an AML program audit should cover policy, governance, management information, board reporting, training, quality assurance, and issue management . By benchmarking against these criteria, we identify areas to strengthen (for example, updating policies, improving board engagement, or enhancing employee training frequency and content). The deliverable is a set of recommendations to bolster governance and instill a stronger compliance culture, customized to any local corporate governance requirements in your country.

10. AML Model Validation Service: For institutions leveraging advanced analytics or AI/ML models in their compliance processes (such as machine-learning algorithms for transaction monitoring, customer risk scoring, or sanctions name-matching), we offer a specialized model validation engagement. We perform a technical and operational review of the model, examining its design, input data quality, segmentation logic, and performance metrics like precision and recall . This includes checking for model bias or blind spots, testing stability over time (drift detection), and ensuring the model’s outputs are explainable to regulators. All model validation findings are documented in line with regulatory expectations for model risk management. By the end, you will have confidence that your cutting-edge compliance tools are not “black boxes” but rather effective, well-governed systems aligned with global best practices and any local guidelines on AI use in compliance.