AML robots: UK regulator highlights use of machines to combat money laundering
23 Apr 2018

The Financial Conduct Authority is to forge ahead with an initiative exploring the use of machines in financial crime programmes, according to its 2018/19 business plan.

The watchdog is looking to host an international event focusing on the machine-led approach in the fight against money laundering, part of its broader goals to tackle fraud and to work closely with law enforcement partners to fight financial crime.

“This year, we will convene an international TechSprint. This will bring together a range of experts to explore whether new technology can be used more effectively to fight financial crime,” it said

“Working in collaboration with others improves intelligence-sharing arrangements to help fight money laundering and financial crime. This leads to more effective and consistent standards and ultimately delivers better outcomes.”

The 2018 event will build on its TechSprint event held last year, which explored the potential for machine readable and executionale regulation.

Following that event, the FCA said that it recognises that regulatory reporting can be a “challenging” subject for financial institutions, and highlighted the usefulness of machines.

“This TechSprint successfully proved that we are able to take a regulatory requirement contained in the FCA Handbook and turn it into a language that machines can understand. Using that language, machines can then execute a regulatory requirement, effectively pulling the required information directly from the firm,” it said.

The FCA’s business plan also outlined key anti-money laundering (AML) developments on the UK scene, including the National Risk Assessment, FATF mutual evaluation and the new Office for Professional Body Anti-Money Laundering Supervision (OPBAS), which was established in February 2018.

Another area of interest to the FCA is e-money, and it explained that it is undertaking diagnostic work on money laundering and terrorist financing risks in the e-money sector.

“This is important because if e-money firms have ineffective systems and controls this could undermine confidence and participation in e-money services and the integrity of the financial system. We will share our findings in Q2 2018/19.” the FCA said.

Irene Madongo

Photo: Geralt

Read more:

Biometrics: Challenges and opportunities for anti-money laundering, fraud prevention

Artificial intelligence: Rise of robots could trigger banking risk

EU Sixth Anti-Money Laundering Directive (6AMLD) – Expert analysis of new EU measures

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