FATF Explores Opportunities & Challenges of New Technologies
The Financial Action Task Force (#FATF) continues to explore the challenges and opportunities presented by new technology. In the first of two reports FATF addresses both existing and new technologies and discusses how digital #innovation can assist with improving the implementation of FATF recommendations. FATF highlights using technology to perform a risk-based approach versus a rules-based approach when implementing an anti-money laundering (#AML) program. The report also mentions that technology can be effective in preventing over reporting, help perform effective analysis and help contribute to financial inclusion by providing solutions for the #underbanked. The report also features new technologies which offer the greatest impact to institutions such as, Machine Learning, Distributed Ledger Technologies, Natural Language Processing and APIs. While there are still regulatory obstacles and operational challenges regarding investments in new technologies or updating legacy systems, to address, FATF continues to adopt new technology. Especially considering FATF and other regulatory innovation teams encouraging firms to replace legacy systems with more automated solutions, this might be a good opportunity to review whether your firm can benefit from some of the many recent advances in Know Your Customer (#KYC) and AML technology.
To see the full report, click: https://www.fatf-gafi.org/media/fatf/documents/reports/Opportunities-Challenges-of-New-Technologies-for-AML-CFT.pdf