Unlocking Next-Gen AML in Capital Markets

The capital markets landscape is evolving rapidly, and with it, the demands on anti-money laundering (AML) controls are intensifying. In a recent webinar hosted by Quantexa, a panel of global experts came together to share practical lessons, challenges, and opportunities in implementing contextual AML risk monitoring within the capital markets space. 

The session was moderated by Matt Long, Head of Quantexa’s Global Financial Crime Solution Suite. Joining Matt were: 

• Ashok Sawant: Head of EMEA Transaction Monitoring at Nomura International Plc, with deep expertise in global wholesale implementation and a background spanning lead investigation and TM model oversight. 

• Katie Gibson: Director in Deloitte’s Financial Crime team, leading Deloitte’s TM proposition and advising clients across industry and consulting for over 13 years. 

• Manish Gupta: Leader of Quantexa’s Capital Market Solution for EMEA and APAC, with more than 15 years’ experience in financial markets compliance across both industry and product organisations. 

Here is what was discussed during the event and the lessons that were learnt.  

The regulatory landscape 

The regulatory landscape is rapidly evolving, and this is reshaping how capital markets approach anti-money laundering (AML) compliance. In recent years, regulators have become increasingly proactive, issuing more prescriptive guidance and raising expectations for firms to not only keep pace with change but to anticipate and address emerging risks. The Financial Conduct Authority’s (FCA) January 2025 paper, alongside guidance from other global jurisdictions, has become a touchstone for firms embarking on transformation journeys. 

Three key trends are shaping the future of AML in capital markets: 

1. Integration of controls: There is a growing expectation for collaboration between Trade Surveillance and Transaction Monitoring functions, supported by KYC and CDD, to ensure firms can detect risks that cut across market abuse and money laundering.

2. Data and intelligence: Regulators expect firms to leverage both internal and external data sources, but the focus is increasingly on how improved data quality and integration, when combined with AI, can provide deeper insights into customer behavior and transaction patterns. This enables organisations to build a more complete risk picture and respond more effectively to emerging threats. 

3. Robust risk assessment: Focused Risk Assessment is fundamental to managing money laundering risk in capital markets, with firms expected to explicitly address money laundering risk in markets in both their business-wide and customer-level risk assessments. 

While regulators are becoming more prescriptive, there’s still inconsistency across the industry. Many institutions have yet to raise suspicious activities or exit customers due to financial crime reasons, raising questions about whether risks are being properly identified or if controls are lacking. The complexity of capital markets, with their fragmented transaction cycles and multiple participants, makes holistic risk identification a significant challenge.  

Data, typologies, and the challenge of fragmentation 

Data fragmentation remains one of the biggest hurdles. Legacy systems, multiple asset classes, and disparate trade flows make it difficult to unify data and create a holistic view of transactions. The solution? Involve data SMEs from the outset and invest in tools that can unify and contextualise data across the organisation. 

The panel agreed that typologies—patterns of suspicious activity—are evolving and complex. Regulators like the FCA have published case studies, but there’s still a need for industry-wide consensus on what “good” looks like. Upskilling investigators and fostering collaboration between compliance and technology teams are essential to keep pace with these changes.  

Overcoming organizational silos 

The challenge of achieving a unified client view in capital markets, where information is often siloed across front office, middle office, and operations. his fragmentation leads to gaps in monitoring and increasing the risk of missed threats. The solution lies in breaking down silos, investing in training, and ensuring that all teams across the organization are aligned and engaged throughout the transformation journey.  

Foundations, success criteria, and governance 

Successful transformation is not achieved through technology alone, but through a deliberate, structured approach that aligns people, processes, and tools. The realities faced by firms navigating complex regulatory demands and operational pressures, highlight the importance of building a strong foundation before pursuing innovation. 

Rather than advocating for quick fixes or one-size-fits-all solutions, organisations should take a step back and focus on the fundamentals that underpin effective AML programs. Here are three essential pillars, each critical for driving sustainable change and delivering measurable outcomes: 

1. Get the foundations right: Start with a robust risk assessment. This underpins everything from regulatory engagement to prioritising implementation. 

2. Define clear success criteria: Set measurable, value-based outcomes that hold vendors and internal teams accountable. 

3. Select the right tools: Build an ecosystem of solutions tailored to the organisation’s unique challenges, ensuring strategic integration and futureproofing. 

It is important that strong governance, model risk management, and involving operational teams are adhered to early in the process. Incremental, risk-based implementation will allow you to build confidence and deliver quick wins while maintaining focus on long-term objectives. 

The role of AI beyond the buzzwords 

The journey towards next-generation AML in capital markets is undeniably complex, but it is also rich with opportunity for those willing to embrace change. By breaking down organizational silos, investing in data and AI, and embedding robust governance and collaboration, firms can not only meet regulatory expectations but also build more resilient, future-ready compliance frameworks. 

Success is not about adopting technology for its own sake, but about aligning people, processes, and tools around a shared vision and measurable outcomes. Whether you’re just beginning your transformation journey or looking to refine your existing approach, the lessons shared by Matt, Ashok, Katie, and Manish offer a practical blueprint for progress. 

If you’re interested in a deeper dive into these topics, including real-world examples and additional audience questions, we invite you to watch the full webinar on demand. Discover how industry leaders are navigating the evolving AML landscape and how your organisation can do the same. 

Watch the full webinar here and take the next step towards transforming your AML controls.