KYC compliance is already getting painful for ordinary bank customers. Please don't bring in more surveillance.
There is an argument that we could have signficantly /less/ regulation if regulation were taken seriously from the top down. This would encourage it to be taken seriously.
1. Identify the subset of people involved and color them red.
2. For each of the red-colored nodes, color their immediate superiors yellow if not colored.
3. Until there are only uncolored or blue nodes left in the company, do:
3a. Put all red and yellow nodes in front of a court (presumably in parallel)
3b. When a verdict is reached for a given node, color it blue.
3c. If a yellow node is revealed to be involved, color it red, and goto step 2.
3d. If an investigation reveals further people possibly involved, color them yellow, goto step 2.
This is based on a principle of "your subordinate, your responsibility", and is meant to give everyone involved and their superiors a fair chance of landing jail time. I would hope the courts are already doing something like this.
Small businesses who are in higher risk industries, however that is chosen to be defined, become inundated with KYC tasks. Every transaction needs an accompanying stack of documents showing the entire trail.
Finance is becoming a bureaucratic hellhole which disproportionately affects lower income people and small businesses. If you don't have a hired compliance agent you will spend your time as a business owner complying to endless demands for onboarding/KYC/transaction reporting.
And it's overt surveillance, where privacy is blatantly criminalized, rather than the type of covert mass-surveillance we're accustomed to hearing about, where a 3 letter agency secretly deprives you of your privacy, showing you enough respect to not demand that you knowingly give it up.
So-called anti-money laundering laws are a complete and utter violation of democratic principles, namely privacy and due process, and create the kind of surveillance apparatus that puts the populace under the complete control of the state.
The public support for this kind of double standard translates to: "we support you being secure in your rights, unless you want to do something meaningful, like send, receive or possess economic value".
As long as these broad invasions of AML laws into privacy are in place, the West's support for the principles of liberal democracy looks superficial.
In the end the KPIs are probably something like “number of accounts blocked”, which is easier with ordinary customers