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AML/CFT Advisory Services Artificial Intelligence BSA Rules and Regulation Cannabis Banking Customer Due Diligence Financial Crime Fraud Prevention Check Fraud Financial Cybersecurity Fraud Trends

Top issues and priorities for AML/CFT & anti-fraud programs in 2025

Mary Ellen Biery
December 26, 2024
Read Time: 0 min
business woman typing on laptop

Financial institutions' will focus on these concerns related to AML and fraud  

Abrigo asked financial institution clients and our Advisory Services team to identify the top issues for 2025. Here’s what they said.

Key topics covered in this post: 

AML/CFT program compliance

Among the hottest issues facing AML/CFT and fraud staff is ensuring regulatory compliance with AML/CFT program requirements, including upcoming changes. "With so many BSA/AML enforcement actions, it is clear that the regulatory environment is tightening up its expectations and is actively pursuing action when needed," said Abrigo Senior Risk Management Consultant Elissa Brewer.

She and other Abrigo advisors believe institutions will face increasing pressure to have compliant AML/CFT programs. Indeed, examiners are expected to emphasize that financial institutions must develop and maintain a culture of compliance. "Compliance is not optional," said Josh Hawkins, Senior Director of Abrigo’s Financial Crimes Investigation Unit.

Compliance will be further complicated for some institutions moving from intermediate to large bank status or expanding markets. Those changes require upgraded technology and staffing efforts.

In addition to current compliance requirements, institutions will need to begin implementing new requirements due to the upcoming final rule to strengthen and modernize financial institutions’ AML/CFT programs.

"This is a pretty big change in many areas," said Abrigo Compliance and Engagement Director Terri Luttrell.

A formal requirement for institutions to develop and update risk assessments is among the expected changes. AML/CFT risk assessments ensure institutions can identify potential vulnerabilities and mitigate them effectively. However, community banks, in particular, face challenges in quantifying risk and applying compliance measures using a risk-based methodology, Brewer said.

The new program rule also requires that compliance efforts incorporate the FinCEN priorities related to fighting financial crime.

Need help navigating new AML program rules? Our Advisory Services team can help.

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Staffing challenges & enforcement actions 

As noted above, staffing plays a significant role in compliance and will, therefore, demand attention in the year ahead. Hawkins said AML/CFT enforcement actions have increased, and many are highlighting the need for adequate and qualified staffing.

Cost-saving measures have led to staffing cuts, leaving some institutions without the resources or qualified staff to manage Bank Secrecy Act (BSA) compliance. Financial crime fighters also often describe a struggle to find and retain experienced employees who truly understand AML and compliance.

Improper staffing can create inefficiencies and increase non-compliance and fraud risk, which could lead to penalties, financial losses, and reputational damage. "Regulators are paying attention to whether or not financial institutions are properly staffed on a risk basis," said Abrigo Senior Financial Crime Investigator Joann Millard.

In a recent Abrigo webinar, many financial crime fighters said their institutions are maintaining or boosting AML and fraud compliance budgets. Still, bankers have identified operational efficiency as one of their top 3 business challenges for the year ahead. More institutions will look to technology for help. Adopting automation, such as enhancing fraud detection workflows and consolidating case management oversight in one system, helps alleviate staffing pressures. Additionally, firms that provide BSA/AML consulting services can provide staffing or policy support to institutions.

chart showing responses to a survey on aml and fraud budgets

AI integration to combat AI-generated fraud

Fraudsters are becoming increasingly sophisticated with artificial intelligence (AI), using it to execute impersonation schemes such as deepfake audio. “AI will be an ongoing hot topic,” said Abrigo Senior Risk Management Consultant Kevin Gulledge.

Financial institutions will need to leverage AI tools to counter these threats, and many Abrigo clients have said that incorporating AI tools and improving the utilization of current systems that incorporate AI are priorities.

Abrigo’s recent poll of webinar attendees found that 30% have AI-integrated solutions. Another 22% are curious about AI solutions, but 48% are unsure or have no plans to implement them.

bar chart showing survey results on use of AI solutions by financial institutions

 

Integrating AI into automated monitoring systems is crucial, but it requires suitable resources for strong oversight and safeguards. Financial institutions also need skilled personnel to validate AI models, ensuring their safe and effective use in fraud detection.

Cybersecurity on center stage

As institutions and their customers or members (especially businesses) become more reliant on digital technologies, their vulnerability to cyberattacks grows. Consequently, cybersecurity will be an ongoing priority. Increased competition from fintechs and other non-bank players and younger generations’ preference for digital banking services are driving financial institutions to rapidly adopt more technology-driven services, which increases their digital footprint.

Maintaining robust cybersecurity defenses—through system updates, proactive security measures, and especially staff training—is critical to safeguarding institutional assets and protecting customer or member data that could be exploited for fraudulent activities.

Evolving fraud threats, enhanced tools

Preventing and fighting fraud is again among the year’s top issues.

Financial institutions seek ways to fight fraud that festers on the Internet, including evolving fraud schemes such as "pig butchering" scams that prey on people looking for romance.

A recent Abrigo webinar on pig butchering found that while most respondents continue to worry most about check fraud as a threat, account takeovers and pig butchering scams are the most concerning rising threats.

bar chart showing survey on financial institutions' rising threats

The generational transfer of wealth, as Baby Boomers pass on assets, also introduces new vulnerabilities, particularly since younger generations bank differently and may be more susceptible to digital fraud. Financial institutions need robust fraud detection systems leveraging automation and advanced tools to counter these growing threats effectively.

Check fraud will also place fresh demands on compliance teams. Based on surveys by Abrigo, fraudulent checks impacted financial institutions more than any other type of fraud in 2023, and it remained a top fraud focus of three-quarters of respondents in 2024. Check fraud detection efforts will continue.

To succeed against fraud, more banks and credit unions must also focus on internal fraud prevention training. In a recent Abrigo webinar with 500 attendees, 50% of respondents highlighted ongoing fraud training as the most significant obstacle to their program. Converging fraud and AML functional areas within financial institutions – or at least collaborating more than ever -- is another trending topic.

A focus on cannabis banking risks

The cannabis banking landscape will continue to pose challenges heading into the next year due to inconsistencies between federal and state regulations. “Banks interested in providing services to cannabis businesses would really like some federal legislation that makes sense and aligns with the majority of the states,” Luttrell said.

However, the incoming Senate leader, Republican Senator John Thune of South Dakota, reportedly has a history of opposing marijuana policy reforms, and the last federal bill on cannabis banking stalled in 2023.

Meanwhile, even if financial institutions do not intend to offer banking services to cannabis-related businesses in states where marijuana is legal, they must have appropriate resources and control over their AML programs for monitoring suspicious activity, particularly given the high volume of transactions and regulatory ambiguities in this sector.

Additional industry issues and priorities

Partnerships between banks and tech or fintech companies can create compliance issues. Some technology companies, fintechs, and non-bank players do not fall under the same regulatory requirements as traditional financial institutions, which could pose a risk to partnering banks and complicate fraud prevention efforts. The Federal Reserve’s FedNow instant payment service only furthers the need to establish and keep strong relationships with their third-party providers. Financial institutions must be vigilant in addressing potential vulnerabilities associated with third-party relationships as well as alternative underwriting processes to ensure sufficient fraud prevention measures are in place.

Finally, FinCEN recently extended the deadlines for reporting companies to file their initial information with the new Beneficial Ownership Registry. Gaps in businesses’ beneficial ownership compliance could lead to fraudulent ownership structures escaping detection. Financial institutions can focus on educating business clients and utilizing the registry to mitigate money-laundering vulnerabilities related to financial crime.

You might also like this webinar with more info on the hot topics in 2025 for fraud and AML/CFT.

Watch the webinar
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About the Author

Mary Ellen Biery

Senior Strategist & Content Manager
Mary Ellen Biery is Senior Strategist & Content Manager at Abrigo, where she works with advisors and other experts to develop whitepapers, original research, and other resources that help financial institutions drive growth and manage risk. A former equities reporter for Dow Jones Newswires whose work has been published in

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About Abrigo

Abrigo enables U.S. financial institutions to support their communities through technology that fights financial crime, grows loans and deposits, and optimizes risk. Abrigo's platform centralizes the institution's data, creates a digital user experience, ensures compliance, and delivers efficiency for scale and profitable growth.

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