Case Study
Optimising Correspondent Banking Compliance: Integrating Customer Due Diligence Controls into Transaction Monitoring System
Data | Banks | London
The Background
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A Tier 1 UK bank implemented Quantexa for Correspondent Banking (CB) transaction monitoring and identified an opportunity to extend its value across financial crime compliance. Manual pKYC and CDD reviews were resource intensive, leading to operational inefficiencies and inconsistent risk assessments
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While Quantexa TM focused on transactional fraud, the bank recognised the need for a dedicated, risk-based CDD control layer aligned to correspondent and respondent risk profiles
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The bank engaged NextWave to leverage its existing Quantexa CB infrastructure, repurposing network analytics, entity resolution, and behavioural profiling to automate and enhance periodic CDD processes.
The Challenge
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Misalignment between TM and CDD functions created fragmented client views and duplicated manual effort.
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Reliance on periodic reviews limited the ability to detect real-time risk changes.
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Sample-based reviews were ineffective in high-volume environments, leaving population-wide risks unaddressed.
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High-risk areas such as virtual asset service providers (VASPs), offshore entities, and trade sanctions were managed reactively through manual processes.
The Approach
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Worked with stakeholders and analysts to translate manual risk assessments into automated Quantexa risk scores aligned to compliance standards and investigator workflows.
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Validated monitoring coverage to support Residual Risk Assessments across all typologies.
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Conducted data quality and technical assessments to ensure scalability and regulatory compliance.
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Defined a technical blueprint integrating CDD controls into the existing ecosystem using separate Explorers to maintain functional separation and maximise reuse of infrastructure.
The Impact
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Delivered a comprehensive Implementation Roadmap, including ready-to-build Jira Epics, detailed risk scoring logic, and feasibility assessments to enable immediate execution.
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Expanded monitoring coverage to high-risk areas including VASPs, high-risk sectors, trade sanctions, and embargoed jurisdictions.
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Provided SME workshops and operating model guidance, streamlining processes through prioritised alerts and automated data collection for reviews.
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Once implemented, the solution delivers consistent compliance, broader risk coverage, and a proactive approach to managing complex correspondent banking relationships.
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