By PAUL O’DONOGHUE, Senior Correspondent
DATA deficiencies contributed to more than two-thirds of UK enforcement cases for AML failures between 2020 and 2025, a new report has found.
The study from Kyckr, which provides real-time compliance information, found that data weaknesses featured in 68% of FCA (Financial Conduct Authority) enforcement actions during the period. Kyckr analysed 22 FCA Final Notices, which together resulted in more than £430 million in fines.
Kyckr identified four main categories of data failure. It said these included:
- Outdated or missing information. ” This included a reliance on outdated Politically Exposed Persons (PEPs) and investor lists. And not collecting sufficient information on customers to contextualise transactions,” the firm said.
- Failures to identify ultimate beneficial owners (UBOs). Kyckr said firms often did not establish who ultimately controlled an entity. As a result, they could not build accurate ownership structures or assess wider financial crime risk.
- Weak verification of wealth and source of funds. According to Kyckr, firms frequently lacked a clear view of how much money a business controlled. This made it harder to put customer activity into context.
- Discrepancies between customer declarations and public records. “his included failure to detect mismatches between ‘what a customer says about themself’ and ‘what the public record shows’,” Kyckr said.
Steve Lamb, chief executive of Kyckr, said the reults show that firms often rely on outdated or incomplete data.
“If poor data quality is a major contributor to AML fines, the solution isn’t more staff or bigger frameworks: it’s direct and ongoing access to authoritative company data,” he said.
Lamb added: “These findings show that policy alone isn’t enough and that data quality now plays a significant role in AML effectiveness.
“Financial institutions must be able to prove that their customer information is both accurate and verified in real time.”
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