On-Chain Analytics and AML Risk in Crypto?

Been diving into on-chain analytics recently, particularly how firms like Chainalysis track flows. My question, for those of you dealing with actual crypto compliance, is how effective are these tools truly in practice for AML? I get the theoretical side – tracing funds, identifying illicit wallets. But when you're looking at a new client and their transaction history, how much do you actually lean on this data vs. traditional KYC docs? Are there specific red flags you've found these tools highlight better than anything else, or is it mostly a supplementary check against what the client provides? Just trying to get a clearer picture of the operational reality.