Resolving Risk Assessment Dimensions into Sub-Typology Exposure Profiles
This paper proposes a structured method for resolving RA dimensions into sub-typology exposure profiles. The approach operates in two steps. First, each sub-typology is mapped to the RA dimension values through which it is enabled within the operating model. Second, per-dimension exposure profiles are calculated using RA-owned risk ratings and exposure proportions, producing a comparative view of exposure concentration without collapsing unlike dimensions into a single aggregate score.
Mapping Typological Risk to Rules: A Foundational Transaction Monitoring Requirement
This whitepaper describes an 8-layer Typological Risk Traceability Model to help Reporting Entities align their Transaction Monitoring (TM) controls with typological risk intelligence. It explores the operational impact of unclear risk signals, the distinction between rules and scenarios, and how structured traceability supports governance and explainability. With practical examples and architectural considerations, the model offers a foundation for building TM frameworks that are risk-aligned and regulator-ready—while recognising that true effectiveness also depends on robust feedback mechanisms.
Part 3 of my series explores the critical role of quality frameworks, controls testing, and independent model validation in ensuring TM effectiveness.
Part 2 of my series unpacks the importance of risk sensitive rules and continuous rule monitoring as key feedback mechanisms driving TM effectiveness.
Transaction monitoring effectiveness: It requires more than technical compliance — Part 1 of my series discusses why feedback loops are key to success.
For many AML/CTF Reporting Entities, customer segmentation remains an afterthought in the Transaction Monitoring optimisation process, if a thought at all. Ensure you understand the relevance of customer segmentation to your TM outcomes.
Is your segmentation model limiting your TM effectiveness? Be sure to read the first in this series of articles on TM maintenance methods, providing an introduction to segmentation.
How effective are your existing transaction monitoring rules? This is the second article in this series on TM maintenance methods, introducing rule tuning.
Are you spending time and resources managing unnecessary transaction monitoring rules? This is the final article in the series on rule-based TM maintenance methods, introducing rule rationalisation.
We use cookies to analyze website traffic and optimize your website experience. By accepting our use of cookies, your data will be aggregated with all other user data.