The digital revolution: Managing the emerging AML and regulatory risks of new payment methods
With the rapid rise of new payment methods including cryptocurrencies over the last few years and many instruments seeing significant price growth, is the intent behind their creation leading to greater financial crime risk?
With many such instruments unregulated, and multiple regulatory jurisdictions calling for greater control, seeking to enshrine them within AML and CTF financial legislation, what are the risks posed?
With this in mind, how can financial institutions remain vigilant and agile to stay ahead of iniquitous actors in an increasingly virtual, mobile and hyper-connected world. And given the challenges of detecting illicit financial activity using established currencies and payment methods, how can we combat criminal activity linked to new payment methods?
Who will bear the responsibility for financial crime compliance? Will FinTechs be held accountable, or will banks need to add this to their overflowing portfolio of responsibilities? And how will cryptocurrency-related crime regulation evolve over the next 12-24 months?
With a strong link to new technologies, could new instruments bring benefits as well as risks? Or are the compliance ramifications too great?