This page shows a collection of national initiatives and developments relevant to FinTech and RegTech.  This page will be updated on a regular basis with content from FATF members and observers, and members of FATF-style regional bodies (FSRBs).

The content of this page does not reflect the opinion of the FATF. The responsibility for the information and views expressed in the different presentations and videos lies entirely with their authors.

Alexandre-Nicholas Rodriguez-Vigouroux from the FATF Secretariat explains more about the platform for the FATF FinTech & RegTech Initiative.  

Australia

Australia

The Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2017 was introduced by the Minister for Justice on 17 August 2017, and received Royal Assent on 13 December 2017.

In accordance with the FATF Guidance for a Risk-Based Approach: Virtual Currencies, the Act regulates digital currency exchanges as the point of intersection between the existing regulated financial system and unregulated digital currencies. In doing so, the Act covers the exchange of fiat currency to high-risk, convertible digital currencies, such as bitcoin, Monero and Zcash, and vice versa.

Download podcast (mp3, 6 Mb)

 

For further information, please contact the Secretariat to Australia’s delegation to the FATF at antimoneylaundering@homeaffairs.gov.au

Germany

Germany - Video Identification

The presentation gives an overview on the approach to video identification procedures  developed by the German Regulator BaFin (Circular 3/2017 of 10 April 2017), together with specialists from other authorities and in close cooperation with banks, Fintech companies and other market participants.

Circular 3/2017 spells out a detailed catalogue of requirements to enable face-to-face identification  through the video transmission, i.e. without the parties being in the same place. The main focus lies on technical requirements (e.g. end-to-end encryption of the video-chat), the description of mandatory security features of the identification document and the verification procedure regarding the customer.

 

For more information:

RD Golo Trauzettel
Federal Financial Supervisory Authority (BaFin) Germany, 
AML Department
Tel. +49 (0)228 / 41 08-30 13
golo.trauzettel@bafin.de

Gibraltar

Gibraltar's 'Distributed Ledger Technology' Regulatory Framework

The Gibraltarian regulatory framework for Distributed Ledger Technologies (DLT) is a full scope regulatory framework in which prudential and conduct of business rules apply, as do CDD/KYC requirements in the same way as they would apply to any financial institution.  Gibraltar has not sought to regulate blockchain or virtual currencies but instead is applying the regulatory principles to those who use DLT to transmit or store value belonging to others.

In applying KYC requirements to this sector the Gibraltar Financial Services Commission requires that in addition to the standard source of funds and identification requirements, the transaction records and monitoring requirements extend to the mechanism and technology used to effect transactions, (IP, MAC addresses, etc) and to have system to identify and mitigate where masking technology is used to obfuscate location and ownership data (e.g. VPN, tunnelling, MAC or IP Masking).  This information will remain part of the transaction records of any DLT provider authorised in Gibraltar thereby linking the medium through a transaction is conducted to a beneficial owner and thereby breaking any anonymity that previously existed in the blockchain.”


For more information: 

Indonesia

Indonesia’s Measures to prevent Fintech from abusing Money Laundering and Terrorist Financing

The presentation consists of Indonesia's Measures in preventing FinTech from abusing ML and TF. Since 2016, Indonesia already has regulations in place relating to FinTech, in particular FinTech Payment and FinTech Lending. Those regulations already exclude the obligation for FinTech to implement AML/CFT Requirements. The presentation also describes in detail the policy that FinTech should implement to prevent themselves from abusing ML and TF. The explanation focusses on 7 (seven) areas, namely (i) CDD; (ii) record keeping; (iii) PEPs; (iv) new technologies; (v) reliance on third parties; (vi) internal controls; and (vii) higher-risk countries. Indonesia's measures to prevent ML and TF in FinTech also include the requirement to use financial institution accounts to support LEAs to trace assets, and the requirement to do a “fit and proper” test for the owner and beneficial owner of the FinTech at its entry in the market. In 2017, Indonesia established a regulatory sandbox for FinTech, specifically FinTech Payment.

Based on global understanding of the potential uses of artificial intelligence (AI) in FinTech, Indonesia also sees the benefit of it, such as (i) Accurate Decision-making; (ii) Automated Customer Support; (iii) Fraud detection and Claims Management; (iv) Insurance Management; (v) Automated Virtual Financial Assistants; (vi) Predictive analysis in Financial Services; and (vii) Wealth Management for Masses. Indonesia also identified the vulnerability of FinTech that potentially makes an entity of FinTech as a high risk, namely: dependent on database only, potential cyber attacks, lack of adequate system to maintain big data, depending on AI, and inaccurate algorithms. Indonesia also provides a brief policy that has been made related to virtual currency.

Jersey

Jersey - eVid initiative

Jersey is looking to use technology to enhance the quality and effectiveness of the CDD process in verifying the identity of individuals across its financial services industry. A working project, ‘Jersey eVID’,  proposes the use of technology to create a centralised utility, with a more standardised CDD process, to simplify the customer experience but with enhanced verification standards. George Pearmain, Lead Policy Adviser for Financial Crime to the Government of Jersey outlines the jurisdictions ambitions in this presentation.

For more information: 

G.Pearmain@gov.je

+44 (0) 1534 448839

Financial Services Unit, Jersey 

Mexico

Mexico - FinTech & Anti-Money Laundering and Combating the Financing of Terrorism

This presentation gives an overview of Financial Technologies, Fintech firms, statistics in Mexico, risk related to this innovations and the regulatory experience. This presentation could be useful for the countries seeking a regulatory framework and all its implications. 

A brief explanation of why Fintech is introduced to the financial system, setting how Mexico is adhering to FATF standards and the importance of international cooperation.

IMF

International Monetary Fund (IMF)

This page groups the various strands of IMF work on the implications of emerging technologies for financial stability, regulation and monetary policy.  

The International Monetary Fund (IMF) is an international organisation that has an observer status with the FATF. The IMF contributes to the global AML/CFT effort.

http://www.imf.org/en/About/Key-Issues/Fintech

 

 

 

 

 

 

 

European Commission

European Commission – A Public-Private Expert Group

The presentation gives an overview of the establishment of an Expert Group on electronic identification and remote KYC (CDD) processes. (Commission Decision C(2017) 8405).

The decision sets out a number of tasks for this Expert group that brings together public experts on AML/CTF, technical experts, supervisors and experts from the private sector (financial institutions/banks) and consumer organisations. The Experts have identified two priority areas on which work has started. The Decision to establish this Expert Group applies until 31 December 2019.

Mr Bertil VAGNHAMMAR
European Commission, DG for Justice and Consumer, 
Unit B3, Financial crime (AML/CTF)
Tel. +32 (0)2296.2143
Bertil.Vagnhammar@ec.europa.eu or ECEIDKYCEG@ec.europa.eu