AML in 2025: Asia’s Compliance Outlook in a Rapidly Changing World

As a compliance officer in today’s financial landscape, I see first-hand how rapidly the fight against financial crime is evolving.

Criminal networks are becoming more sophisticated, and according to the UN Office on Drugs and Crime, financial crime drains up to US$2 trillion from the global economy each year.

The scale of suspicious activity reporting across the Asia-Pacific region is unprecedented. Regulators attribute much of this rise to scams, child exploitation payments and the surge in online gambling platforms and crypto exchanges, which are reshaping the money laundering landscape at a dizzying pace.

UNODC estimates that hundreds of industrial-scale scam centres in the region generate around $40 billion in annual profits.

According to Jeremy Douglas, UNODC’s Regional Representative for the Southeast Asia and the Pacific ‘Casinos and related high-cash-volume businesses have been vehicles for underground banking and money laundering for years, but the explosion of underregulated online gambling platforms and crypto exchanges has changed the game’.

This complex and fast-moving environment is exactly why robust anti-money laundering (AML) frameworks matter.

AML refers to the systems, controls, and regulations designed to stop criminals from disguising illegally obtained money as legitimate funds.

Without effective AML measures, financial systems could be exploited to channel money from activities such as fraud, corruption, tax evasion or organised crime.

This not only damages the integrity of financial institutions but also poses risks to economies and societies more broadly.

AML principles centre on three core areas:

• Know Your Customer (KYC): financial institutions are required to verify who their customers are, confirm their identity and understand the nature of their financial activity. This is our first line of defence against criminals attempting to move illicit funds through the system.
• Customer Due Diligence (CDD): once the customer is onboarded, institutions carry out ongoing checks to assess the level of risk they may pose. This involves reviewing factors such as their source of funds, the countries they transact with and whether they are politically exposed persons (PEPs).
• Transaction monitoring: financial institutions track customer activity on an ongoing basis, looking for unusual or suspicious patterns. This might include sudden large transfers, unusual cross-border payments or activity inconsistent with a customer’s known profile.

Together, these measures form the backbone of AML compliance, helping institutions such as ours to prevent money laundering and protect the integrity of the financial system.

While we understand that clients can be frustrated with the level of information we require from them, these principles are the reason why.

Against this backdrop, regulatory pressure is intensifying. The Financial Action Task Force (FATF) remains the global standard-setter, and its grey and black lists are powerful drivers of reform.

The Philippines’ removal from the grey list in 2025 shows how governments can respond effectively by tightening oversight of high-risk sectors such as casinos, money transfer services and beneficial ownership reporting.

Yet vulnerabilities persist: Laos and Nepal were recently added to the grey list, joining Vietnam, while Myanmar remains blacklisted alongside Iran and North Korea.

For countries and institutions, placement on these lists carries real consequences, from reputational damage to increased due diligence requirements and even reduced access to global financial markets.

Asia-Pacific regulators are tightening alignment with FATF standards, ensuring that their institutions remain in step with global expectations.

The main regulators driving enforcement and supervision in the region include AUSTRAC, MAS, the Hong Kong Monetary Authority (HKMA), and Japan’s FSA. These agencies are increasingly working together, recognising that financial crime in Asia-Pacific often spans multiple borders.

Current priorities reflect this cross-border reality. Authorities are paying closer attention to virtual assets, decentralised finance (DeFi) and cryptocurrency exchanges, all of which present fast-evolving money laundering risks.

When it comes to financial crime, prevention is better than cure and AI is driving a shift from reactive to proactive measures.

Companies that invest in technology, strengthen reporting and engage in collaborative intelligence networks will be better placed to protect themselves – and the financial system – against the growing threat of financial crime.

Artificial intelligence (AI), real-time monitoring and regulatory technology (RegTech) are redefining how AML compliance is managed across the region in the following ways:

• AI-led analytics are moving us beyond traditional rules-based systems, helping detect hidden patterns in vast datasets and reducing false positives. This allows compliance teams to focus resources on genuine risks rather than chasing noise.
• Perpetual KYC (pKYC) is replacing static periodic reviews with continuous, real-time updates to customer profiles – a vital tool in fast-moving markets where risk exposure can change overnight.
• RegTech solutions are automating workflows and integrating data across borders, enabling compliance teams to scale their efforts more efficiently.

Yet these technologies also bring challenges. Regulators in Asia are increasingly concerned with AI governance – requiring explainability, transparency, and safeguards against bias. It is essential to ensure adoption of these tools goes hand-in-hand with strong oversight.

The lesson for 2025 is clear: AML programmes must be agile, data-driven and globally aware, and in organisations like ours where cross-border flows are significant, we face the dual challenge of meeting domestic expectations while keeping pace with international standards.

One of my goals as Compliance Officer at Infinity Financial Solutions (powered by Hoxton Wealth) is to ensure that the AML frameworks we put in place as a critical defence against financial crime not only respond to regulations, but also anticipate them, ensuring that we are not only compliant today but also resilient tomorrow.