The customer experience

Authors: Kirstie Ball, Sally Dibb and Keith Spiller of the Open University Business School and Ana Canhoto of the Oxford Brookes University Business School.

The regulations around anti-money laundering (AML) place private sector organisations at the frontline of crime prevention and, in the case of counter terrorist financing (CTF), national security. Know Your Customer (KYC) and Customer Due Diligence (CDD) raise questions that concern not just regulatory compliance but also the impact of AML on core business processes and competitive advantage.

Financial services organisations monitor customer transactions both to detect suspicious activity and for marketing purposes. Customer relationship management (CRM) involves mining the information to anticipate and service customer needs over the longer term; it has proved highly effective, enabling firms to identify lucrative prospects, target messages and products, and generate revenue. As well as relying on the same data as CRM, AML employs similar statistical techniques to derive its results. CRM focuses on the attractive customers, whereas AML seeks to isolate the risky ones. The close parallels prompt questions: do organizations that know a lot about their customers through CRM prove equally competent at AML? How does AML, as it translates into operational requirements, affect the customer relationship? Recent opinion from Harvard Business School [1] suggests that business organisations have a duty to take their social responsibilities – including combating financial crime – as seriously as they do their commercial imperatives. But questions persist over the degree of responsibility and pressure that AML/CTF imposes on regulated businesses and, by extension, their customers.


1. Porter, M and Kramer M (2011) ‘Creating shared value: How to reinvent capitalism – and to unleash a wave of innovation and growth’, Harvard Business Review January – February, pp 62 – 77