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Navigating AML Compliance for Cross-Jurisdictional Crypto Trades
I'm curious about how other folks are handling AML compliance for clients involved in crypto trades across multiple jurisdictions, especially when one of those jurisdictions has less stringent KYC/AML requirements. We're seeing an uptick in such activity and the risk profile becomes tricky quickly. Are you relying primarily on the strictest jurisdiction's standards, or is there a more nuanced approach to due diligence that balances compliance with operational efficiency without excessive friction for legitimate clients? Specifically, any strategies for flagging anomalous transaction patterns that might slip through if only basic checks from a 'looser' jurisdiction are applied initialy?
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We've generally adopted the strictest standard approach, as it minimizes overall risk and simplifies internal procedures. However, the nuance comes in when the less stringent jurisdiction has a very high volume of legitimate activity, which can make applying the strictest rules a drag on operations. It's a tricky balance.