Streamlined onboarding at Hauck Aufhäuser
A look at how private bank Hauck Aufhäuser automated its client onboarding, freeing up team resources and improving the customer experience.
A bank in motion
Hauck Aufhäuser is a leading international private bank, headquartered in Frankfurt and with a major presence in Luxemburg. Managing nearly €12 billion in assets and employing over 1.500 people across 18 locations, the bank has a stellar reputation with international clients and investors alike.
Challenge: operational efficiency
The Asset Servicing division at Hauck Aufhäuser was looking to increase its overall operational efficiency while striking a delicate balance to meet stringent regulatory requirements without compromising the onboarding experience for new clients.
Like many of its industry peers, the bank faced challenges with its complex AML/KYC processes for onboarding funds. Manual procedures typically increased the risk of incomplete data, excessive paperwork, prolonged onboarding cycles and even potential compliance risks. Hauck Aufhäuser sought to speed up these (occasionally even redundant) AML and KYC workflows.
The organisation’s push for automation was driven not only by tightening regulations for fund service providers, but also by the need to improve internal operational capabilities and efficiency. The management team recognised that integrating the right tools on a unified platform would help them to both increase customer satisfaction and save their teams valuable time to focus on more strategic, high-value activities.
Solution: company-tailored KYC management
To address these challenges, Hauck Aufhäuser implemented Finologee’s KYC manager, the Harmoney-powered platform specifically designed for the Luxembourg market.
The main objective? To automate the intricate funding onboarding processes while ensuring full compliance with both local and international AML and KYC regulations.
Key advantages of the platform:
- Modular design and seamless integration. The platform integrates natively with existing in-house systems, document management software and external applications. This streamlined connectivity reduces set-up times, avoids potential integration issues and eliminates the need for lengthy integration development cycles.
- Customisable to fit banking needs. KYC Manager adapts to the unique requirements of the bank, preserving its company DNA. It offers the flexibility to fine-tune compliance processes, ensuring they align perfectly with the nuanced workflows of a private bank while maintaining full regulatory compliance.
- Centralised management for agents and dossier managers. A centralised approach to all AML/KYC management – ranging from document collection all the way through to risk assessment – saves the banking agents time. Automated data enrichment improves the accuracy of end customer records.
Modules used
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M.01 Identification and validation
Harmoney facilitates a smooth identification process to onboard or reboard private individuals as well as more complex legal entities and trusts.
Conceived for an omnichannel environment, it leverages pre-filled information from internal and external databases, with the end client able to digitally confirm or make modifications to the pre-filled datapoints and documents via an intuitive workflow. The process can be configured to meet the financial institution’s particular needs.
For private individuals, worldwide ID checking can be added to the configuration to give greater reassurance on fraud detection. The confirmed data and documents can then be instantly and efficiently transferred via the API Gateway to the financial institution’s systems, with no loss of data quality.
M.02 Automated data and document enrichment
Making the whole process frictionless for both clients and employees, Harmoney extends the potential of external and internal databases by connecting with external data providers such as Bureau Van Dijk, Dun & Bradstreet and Creditsafe/Graydon and country-specific public databases.
These connections allow for automated data and document enrichment, both for private individuals and legal entities. This automation can include UBOs and board members and could extend to the crucial documents needed to onboard legal entities, such as deeds of incorporation and by-laws.
While these pre-filled journeys enhance customer experience, they also generate efficiencies for employees, since all data and documents are easy to find in the system without the need for handovers.
And from a client lifecycle management perspective, client data and risk assessments are continuously kept up to date. Daily automated checks for potential changes in external databases can trigger intelligent workflows, potentially leading to renewed risk assessments. In turn, this could initiate additional data or digital document collection, including validations of these changes by the end-client.
M.03 UBO verification and confirmation
In an ideal world, external databases would be 100% reliable. But, the reality is that a time-stamped confirmation by the end client is the only way to be confident about data quality.
With pre-filled information, legal entities can be invited to digitally confirm or modify UBO-related information.
Legal entity managers can also easily initiate workflows in parallel to collect relevant data or proof of ID of these UBOs, reducing the administrative burden. Fraud detection services for ID documents can be included for reassurance and to meet regulatory requirements.
Digitally signed confirmation timestamps provide a clear audit trail and can automatically generate triggers for future frictionless client outreach if reconfirmation is part of your client lifecycle management processes.
With Harmoney, the UBO confirmation process, often perceived as tedious and cumbersome, is rendered simple and straightforward.
M.06 AML, PEP, sanction, embargo and adverse media screening
Whether it’s in the onboarding acceptance process or as part of client lifecycle management, Harmoney caters for automated screening. Screening providers such as LexisNexis, Refinitiv, and Dow Jones are already integrated within the Harmoney solution. Financial institutions can keep their screening providers of choice and Harmoney easily links to them via an integration layer.
This brings all the benefits of integrating the Harmoney solution while maintaining risk screening continuity, with features such as ‘fuzzy matching’. Detailed reports on ‘hits’ can be automatically generated and linked to the private individuals or legal entities concerned. In many cases, institution-specific blacklists are also included in the automated screening.
M.07 Comprehensive risk scoring engine
The risk scoring module can be configured according to the risk matrix of the individual financial institution. The scoring engine can manage a high level of complexity and can include a range of risk parameters relevant to every stakeholder involved, whether UBOs, insured persons, company groups or other related parties, or related to the type of contract or product.
Depending on the risk scoring outcome, a range of workflow configuration types can be defined to meet your exact needs: from automated approval processes and requests for further information via the client outreach module, to escalation workflows and the acceptance/rejection decision-making process.
A clear track of the screening as well as every decision and interaction is retained to provide a continuous audit trail in the contract or client file.
Outcome: fully integrated AML and KYC that saves time
After integrating KYC Manager, Hauck & Aufhäuser managed to achieve the perfect equilibrium between full compliance and a seamless investor onboarding experience. The platform’s features, including Ultimate Beneficial Owner (UBO) verification and risk scoring, have helped to simplify and enhance the bank’s various onboarding workflows. “Before KYC Manager, our internal perpetual KYC strategy was heavily reliant on manual efforts, demanding considerable resources,” says Christian Mader, a member of Hauck Aufhäuser’s management board. “Now, we have a solution that is both integrated and intuitive.”
© Finologee.
The centralised dashboard provides a comprehensive overview of dossiers for agents.
The integration and automation of the bank’s KYC processes underscores the transformative power of integrated, omnichannel compliance. “We’re looking to further harness the platform’s capabilities to anticipate new regulations, so we can maintain the exceptional standards we hold ourselves to,” Mader concludes.
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