Doing the bare minimum is no longer acceptable when it comes to anti-money laundering/counter-terrorist financing (AML/CTF) compliance. The global regulatory environment is evolving around governments implementing stricter AML laws, international regulators increasing enforcement actions, and new innovative technology that opens up opportunities for businesses, consumers, and criminals. Let’s have a look at what has been happening over this week.
Global regulatory changes:
UAE authorities impose fines on non-compliant firms
The number of UAE Designated Non-Financial Businesses and Professions (DNFBPs) identified as high-risk has reached 255, and they will be subject to a thorough onsite inspection. Medium and low-risk entities will be subject to a remote inspection or ‘desk inspection.’ They will also be required to attend awareness seminars on the procedures to enhance their compliance levels. The Ministry of Economy (MoE) efforts are directed towards meeting compliance in two main areas, including the regulation and supervision of the DNFBPs to ensure they meet the legal requirements.
AUSTRAC issued TF warnings to big tech companies like Amazon and Google
The Department of Home Affairs and AUSTRAC have issued a warning to the world’s biggest technology companies, including Amazon and Google, demanding they do more to ensure terrorists are not unwittingly using them to raise money. The companies have been alleged to be exploited by bad actors and warn them to uplift their game.
Fraud and corruption news:
UK official sized cryptocurrency scam valuing $22 million
The UK police have seized cryptocurrencies worth $22.2 million after discovering a global fraud scheme. The discovery has brought into focus the anonymous and international nature of these virtual currencies. Criminals often take advantage of anonymity to launder money and terrorism, tax fraud, and drug trafficking. Detective Chief Inspector Joe Harrop of the Economic Crime Unit said people are increasingly moving online and see cryptocurrency as the future of money and trading. But this shift is also leading to a new type of crime, and opportunist criminals are looking to exploit these trends and any gaps in the technology.
KYC tech and trends:
Decentralised crypto coming to an end
Global regulators saw crypto markets growing by $1.5 billion in 2020, with expectations to grow by more than three times in the coming decades. The fast-paced growth leads to the increased KYC & AML regulatory restrictions for the industry. Recent statements by SEC Chairman Gary Gensler suggest that the rules governing traditional currencies would now be strictly applied to cryptocurrencies — particularly when it comes to money laundering. FATF, FinCEN (Financial Crimes Enforcement Network), and SEC (Securities and Exchange Commission) are a few global regulators issuing a strict regime for the crypto industry. Things have become more difficult for exchanges raising the question — ‘Where do we go from here?’.
Reports project AML software market to reach $1743.9 million by 2027
The global AML Software market size is projected to reach US$ 1743.9 million by 2027, from US$ 948.6 million in 2020, at a CAGR of 8.6% during 2021–2027. Organisations use AML software to meet the legal requirements for financial institutions and other regulated entities to prevent or report money laundering activities. The report gives us an insight into the AML industry opportunities, trends, market growth factors, revenue, and forecast.
India ranks second in crypto adoption globally
According to reports, crypto adoption rose by 881% worldwide in 2020. India’s crypto bull market was triggered in March 2020 by a Supreme Court ruling that set aside the Reserve Bank of India’s April 2018 directive banning banks and finance companies from dealing in virtual currencies. Following the verdict, the country’s top exchanges doubled down on advertising and educating users about the asset class. Top crypto exchanges and platforms in India have been operating with limited banking access. The industry is now eagerly waiting for the proposed cryptocurrency bill to be passed by the cabinet.
This week at Data Zoo:
Your Guide to Money Laundering/Terrorism Financing Risk Assessments
We are digitally dependent on everything, increasing the risk of identity theft, money laundering, and other risks for you and your businesses. It is impossible to make your business risk-free, yet it is crucial to take steps to mitigate it at every level. The dynamics of risk have changed, with it becoming an ongoing process.
Author Sara Singh Tak, Data Zoo Marketing Specialist
About Data Zoo:
Data Zoo is setting the new standard for identity verification. With over a decade of experience, we have helped top global organisations reduce risk and verify their customers. Our innovative global solutions utilise independent; government, credit, utility, and commercial data sources to provide clients with industry-leading match rates and unparalleled response times.