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Automated enhanced background checks for financial institutions
Financial institutions bear a particular responsibility for limiting and managing the risks of money laundering and terrorist financing. Organisations must have procedures and internal controls in place to prevent employees from abusing their positions. Under the Anti-Money Laundering Act, financial institutions are required to maintain written policies, procedures, and controls — including the screening of employees.
Challenges in financial sector compliance
The financial sector operates under strict and continuously evolving regulatory requirements.
Organisations must ensure that employees, board members, and key function holders undergo proper background checks, and that all documentation meets regulatory standards. In practice, this is often complex and resource-intensive.
Manual processes can lead to:
- Delays in onboarding
- Incomplete or inconsistent documentation
- Increased risk of non-compliance
- Time-consuming audit preparation
At the same time, regulatory expectations continue to evolve, requiring organisations to maintain accurate, traceable, and audit-ready records at all times.
Useful features for financial institutions
P-Secure automates the verification of identity, CV, criminal records, and references — ensuring precise, timely controls and reducing the risk of human error.
ID and CV check
Automate ID verification and CV checks including documentation of employment gaps
Ongoing screening
Monitor and document criminal convictions during employment in line with the Anti-Money Laundering Act
Audit
Share specific cases for digital audit with Finanstilsynet or internal auditors
Criminal record monitoring
Receive automatic notification if an employee is convicted of a relevant offence during employment
Regulatory framework
The Anti-Money Laundering Act
The Anti-Money Laundering Act applies to individuals and organisations conducting business activities that carry a risk of being exploited for money laundering or terrorist financing.
Section 8 of the Act requires organisations to screen employees — including ensuring that a person has not been convicted of a criminal offence that poses an imminent risk of abuse of their position, prior to employment. Organisations must also be notified if employees are convicted of such offences during the course of their employment. A risk-based assessment should be applied depending on the function the employee will perform.
DORA (Digital Operational Resilience Act)
The DORA regulation on digital operational resilience in the financial sector requires financial institutions to maintain the same high level of organisational security as critical entities.
In addition, there are already several areas within the Management Order (Executive Order on the Management and Governance of Credit Institutions, etc.) where enhanced background checks can strengthen requirements for adequate security measures.
Fit and proper in the financial sector
Financial institutions are subject to requirements that board members and individuals in key functions must be fit and proper for their role — the so-called fit and proper requirement, which follows from CRD (credit institutions), MiFID II (investment firms), and Solvency II (insurance), as well as Danish financial legislation.
The assessment rests on two dimensions:
- Fitness (fit) — sufficient professional qualifications, education, and experience to fulfil the role in question
- Propriety (proper) — clean criminal record, good reputation, and absence of conflicts of interest
A structured background check provides precisely the documentation that the fit and proper process requires: verified CV history supports the assessment of fitness, while criminal record checks and reference checks support the assessment of propriety. P-Secure automates and documents these controls digitally, enabling organisations to demonstrate to Finanstilsynet at any time that the process has been carried out correctly and consistently.
The need for modern background screening
As financial regulatory requirements have tightened, many organisations face increasing pressure to modernise their background check processes.
Manual workflows often result in:
- Limited visibility
- Administrative burden
- Delays in onboarding
- Insufficient documentation
- Inefficient audit preparation
Compliance infrastructure for the future of finance
The opportunity
Today's financial institutions must balance strict compliance requirements with operational efficiency.
As regulations evolve and workforce mobility increases, organisations need automated and continuous background screening that reduces risk without slowing operations.
Strengthen HR and compliance processes
Implement automated, compliant enhanced background checks that:
Reduce onboarding time
Ensure consistent documentation
Cover employees, board members, and key function holders
Maintain continuous compliance
Move beyond one-time checks with:
Automated CV verification
Documentation of all employment gaps
Centralised, audit-ready records
Security and GDPR-compliance
Ensure alignment with the Anti-Money Laundering Act, DORA, and fit and proper requirements at all times.
