Saxo Bank Advances New Risk Model to Enhance Compliance

Saxo Bank has been rolling out a new risk model that improves client risk scoring, streamlines processes and enhances due diligence.

Key Points:

• The new risk model will generally reduce or maintain risk scores for most clients, leading to fewer ODD requirements and more automated case processing.
• A few clients may face higher risk levels, necessitating enhanced due diligence or, in rare cases, offboarding.

Since April, Saxo Bank has implemented a new client risk model to enhance its financial crime prevention strategies. The rollout, expected to continue over the coming months, introduces a revamped AML risk scoring framework to identify better and manage potential risks.

Saxo Bank Advances New Risk Model to Enhance Compliance

The new model will either maintain or lower risk scores for most clients. This change will streamline processes, reduce Out-of-Distribution (ODD) requirements, and automatically boost the number of cases processed. In contrast, some clients might experience an increase in their risk levels, necessitating more comprehensive due diligence. In rare cases, this could even lead to offboarding.

The updated risk model evaluates clients based on various criteria, including demographic information, geographic exposure, connections to politically exposed persons, and sanctions lists. This framework allows Saxo Bank to allocate resources more effectively for due diligence and monitoring, ensuring adherence to legal regulations and mitigating potential financial crime risks.

The rollout initially focuses on private clients. In later phases, Saxo Bank will address joint accounts and corporate clients. Asset managers do not need to take any action at this time. Saxo Bank‘s continued efforts reflect its commitment to maintaining robust compliance measures and addressing evolving financial crime threats in the industry.

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