Regulatory Reporting definition and meaning | AML glossary
Regulatory reporting definition: What it means in AML compliance.
Regulatory reporting is the process by which firms submit data and documentation to regulators to demonstrate compliance with legal and financial regulations. In the context of AML (Anti-Money Laundering), this often involves submitting reports on suspicious activities, large transactions, or internal compliance controls.
It’s a vital mechanism for enabling regulators to detect financial crime, assess risk exposure, and confirm that firms are adhering to relevant legislation such as the Money Laundering Regulations 2017, FCA requirements, or international FATF standards.
Types of regulatory reports in AML compliance.
Common forms of reporting include:
- Suspicious Activity Reports (SARs): Required when there is a suspicion of money laundering or terrorist financing.
- Threshold transaction reports: Triggered when a financial transaction exceeds a set monetary limit.
- Annual compliance returns: Submitted to demonstrate ongoing efforts to comply with AML obligations.
- Ongoing monitoring reports: Showing how firms track high-risk clients and unusual transactions.
Who needs to report and when?
Regulatory reporting applies to a broad range of businesses under AML regulations, including banks, legal firms, estate agents, and accountancy practices. Reporting is often required:
- In line with scheduled compliance reviews or regulatory reporting cycles.
- Immediately following a trigger event (e.g, detection of suspicious activity).
- As part of onboarding or risk reassessment processes.
What are the consequences of failing to meet regulatory reporting obligations?
Not meeting regulatory reporting duties can expose firms to a range of risks:
- Heavy financial penalties issued by regulators.
- Criminal liability in cases of wilful negligence or concealment.
- Increased regulatory intervention or future audits.
- Reputational harm affecting client confidence.
- Loss of authorisation to operate in regulated industries.
Examples of regulatory reporting failures and fines.
Not meeting regulatory reporting duties can expose firms to a range of risks:
- NatWest (2021): Fined £264 million by the FCA for failing to properly monitor and report suspicious activity tied to a corporate client that deposited nearly £400 million in cash.
- Commerzbank London (2020): Fined £38 million for failing to implement adequate AML controls and reporting processes.
- Santander UK (2022): Received a £107.8 million fine for serious and persistent gaps in its AML reporting and oversight of business accounts.
- Standard Chartered (2019): Fined over £102 million by the FCA for AML and sanctions violations, including failures in SAR reporting and transaction monitoring.
These cases show how inadequate reporting or monitoring can result in severe financial and reputational damage.
Common challenges in regulatory reporting.
- Data fragmentation: Reporting data is often stored in siloed systems.
- Manual processes: Time-consuming and prone to human error.
- Changing requirements: Regulations are frequently updated.
- Inconsistent risk assessments: Weak documentation affects reporting accuracy.
How technology can support regulatory reporting.
Automated compliance platforms can help firms:
- Capture and structure reporting data during onboarding and monitoring.
- Generate audit-ready records with complete reporting trails.
- Stay aligned with the latest regulations, reducing risk of missed reports.
- Improve visibility across client and transaction data, helping detect anomalies early.
We’ve worked with hundreds of regulated businesses. Let’s work together.
Book your free demo of our comprehensive ID&V, KYC, KYB and AML compliance management solution today.
Request Demo
Hi 👋 let’s schedule your demo.
Tell us a bit about yourself.
“
The system efficiently and effectively completes our KYC and KYB verification requirements during onboarding.
Robin Kear
Senior Account Executive
