.webp)
Published onÂ
June 24, 2025
Impact of False Negative Results on AML Compliance Programs

Accelerate AML Compliance: Meet Regulatory Demands with 80% Less Setup Time
A false negative in the context of Anti-Money Laundering (AML) occurs when a suspicious activity is not flagged by the monitoring system, even though it should have been. This is the opposite of a false positive, where legitimate transactions are flagged. A false negative can lead to the failure to detect money laundering, fraud, or terrorist financing activities, allowing illicit transactions to go undetected and processed without further scrutiny.
In financial crime prevention, a false negative might happen due to weaknesses in the transaction monitoring system or due to gaps in the algorithms used to detect suspicious behavior. For example, a transaction could involve money laundering or other illegal activity, but because it doesn't match specific patterns or thresholds, it isn't flagged for further review. This could be highly risky, as the financial institution might unknowingly process illicit funds.
Real-Life Scenario:
A notable example of false negatives occurred with Danske Bank in 2018, one of the largest financial scandals in Europe. The Danish bank was accused of processing over $200 billion in suspicious transactions through its Estonian branch. The funds were transferred from Russia, Azerbaijan, and other countries with high risks of money laundering.
Danske Bank had an AML system in place, but false negatives within its monitoring software allowed these illicit transactions to be processed without raising flags. The monitoring system failed to detect many of these large transactions, either because the transactions didnât fit the exact patterns that the system was designed to identify or because the thresholds for suspicious activity werenât triggered.
In this case, the failure to detect suspicious activity via false negatives led to the illicit funds being processed, damaging the bankâs reputation and resulting in multi-billion-dollar fines. The false negatives allowed the criminal activity to continue unchecked, and only after internal audits and whistleblower reports was the full scope of the illegal transactions uncovered.
Streamline Compliance: Achieve 80% Faster Setup for Fraud Prevention

How Aseel reduced onboarding time by more than 87% using FOCAL
Learn how FOCAL empowered Aseel to achieve new milestones.


Mastering Fraud Prevention: A Comprehensive Guide for KSA and MENA Businesses
51% of organizations fell victim to fraud in the last two years, don't be caught off guard, act proactively.


Featured blog posts


Impact of False Negative Results on AML Compliance Programs
Learn how a false negative in AML systems can let illicit transactions slip through, and why stronger detection algorithms are critical to financial compliance.
.webp)

Impact of False Negative Results on AML Compliance Programs
Learn how a false negative in AML systems can let illicit transactions slip through, and why stronger detection algorithms are critical to financial compliance.
.webp)

Impact of False Negative Results on AML Compliance Programs
Learn how a false negative in AML systems can let illicit transactions slip through, and why stronger detection algorithms are critical to financial compliance.
.webp)





AI-Driven Precision in Fraud Risk and AML Compliance

