Lucinity’s new Head of Legal and Compliance, Daníel Pálmason, shares his experience of becoming the company’s first customer and the decision to join our team.
“I recently joined Lucinity as Head of Legal and Compliance, but my journey with the company starts long before that. I wanted to share my reasons for changing careers and tell you a little bit about the experience of bank executives who are trying to fight money laundering.”
Experiencing the problem first-hand
As the Head of Compliance at Kvika banki, I came across the same problems many financial organizations, particularly banks, currently face. An essential part of my job was to lead and oversee the bank’s Anti Money-Laundering (AML) efforts. My team shouldered the heavy load of both rightfully increasing regulations and the role of gatekeepers to the financial system. A role that is vital to keeping the system clean, but I felt that we didn’t have the right tools to win this battle. Like almost all banks, we relied on rule-based transaction monitoring systems that were not very effective or easy to use.
The outdated design of the systems, which were created at the turn of the century and had not been updated much since, caused several concerns. The number of false-positive alerts was very high, and little, if any, information was offered regarding the reason for suspicion. To top it off, the user interface was far from friendly, which made life harder for my team. All these issues contributed to a very time consuming monitoring and investigative process.
Hunting for a better solution
The bank continued to grow, and so did regulatory demand and my frustration with the existing tech tools. I was on the hunt for a better solution. In addition to the issues I’ve mentioned, I was looking for a system that would allow the bank to continuously monitor and rate the risk associated with each customer from a money laundering standpoint.
As I started to examine the available solutions on the market, it seemed that most of them were still utilizing the same old-fashioned rule-based approach, ‘bolting on’ new features to legacy technology using out-dated solution architecture. They also required a long and complex implementation process from an IT perspective.
Some of the more modern systems I came across were better, with some AI integrated, but still mainly focused on a rule-based detection model and lacked a new and innovative perspective.
Meeting Lucinity as a customer
I finally found that new perspective when I met the team at Lucinity. When they presented their approach to transaction monitoring, the idea of combining AI with human capabilities while focusing on the customer’s overall behavior made perfect sense. I was also impressed with the team’s extensive compliance and technology experience. My faith in the company’s solution and the team led me to purchase it and provide insights as Lucinity’s first customer.
The results were quick to follow. Within months, a fully functioning transaction monitoring system was in place, spotting complex suspicious transactions and offering a fast investigation of each case using the innovative case manager. The number of false positives dropped significantly, we were reporting more cases to authorities, and the entire process became smoother and faster.
Shortly after that, Lucinity developed its Actor Intelligence module, which offers continuous, real-time risk monitoring and rating to customers while integrating with the existing transaction monitoring system. This actor-based holistic view improves the risk awareness of compliance teams worldwide. It allows financial institutions to really know their customers while significantly reducing the need for manual and periodical review of each client.
Joining the team
When the opportunity came to join Lucinity as a team member, I had solid reasons to take it. I felt that the company offers an innovative solution to one of the most critical problems financial institutions face today. After personally experiencing the results, I had strong faith in the team and the technology. I want to help my former colleagues at banks embrace this modern approach to AML and make their work more accurate and efficient. You can say that, just like Lucinity’s tagline, I want to help “make money good.”
I also feel that I have plenty to contribute to the company. My experience enables me to offer the market’s perspective and incorporate it into Lucinity’s operations and products. After all, who can better represent customers than a happy, loyal customer?
It’s exciting to think of what lies ahead. Being part of a talented team that tackles a serious problem with the most innovative technology is inspiring. I hope to harness my knowledge and skills to help march Lucinity and the financial world forward.