Keeping Up With the Regulators — October 2019 Week #4

Your weekly briefing on what’s new in KYC/AML for FinTechs

Photo by Jorge Alcala on Unsplash

As promised, Fractal is sharing our weekly briefings to help FinTechs stay up-to-date with the latest developments in the KYC/AML regulatory space. In case you missed our last issue, here it is:

Keeping Up With the Regulators — October 2019 Week #3

Find last weeks’ briefing below:

Week 18.10.2019–25.10.2019

What’s cooking in the regulatory space?

• Canada: B.C. Securities Act changed to improve the ability to collect penalties on white-collar investment offences
• Canada: First of five public meetings, where B.C’s residents are invited to share feedback and concerns on money laundering, took place last week
• Europe: A draft proposal by the Finnish EU presidency wants a European AML agency, a mechanism to coordinate national investigations and further alignment on rules on fines
• Estonia: Finance minister criticized for holding up reforms promised after Estonia became the focus of Europe’s biggest money-laundering scandal
• France: French Prudential Supervision and Resolution Authority (ACPR) published its report on banking and insurance groups’ AML controls
• International: FATF publishes “Best Practices on Beneficial Ownership for Legal Persons”
• USA: The House passed a bill that would require companies to report their true beneficial owners to FinCEN. Wall Street lobbying groups support the bill
• USA: House passes the Counter Act, which would extend the application of the Bank Secrecy Act (BSA) to the art and antiquities market. Dealers would be required to report transactions exceeding $10,000
• USA: FinTech charter, which allowed tech start-ups trying to become banks expedite the process, stopped by a federal judge in New York
• USA: FinCEN prohibits US financial institutions from opening or maintaining a correspondent account on behalf of an Iranian financial institution and from processing transactions involving Iranian FIs
• USA (Wisconsin): A state Senate committee will hold a hearing on a bill to create a statute on money laundering in Wisconsin

News

• Fractal will launch a free tier for KYC/AML on November 1
• FinCen (US) Director says FinTech firms offering cryptocurrency users anonymity must comply with AML laws “just like everyone else”
• Iranian Foreign Minister says FATF’s call for increased monitoring of Iran-based branches and subsidiaries of financial institutions is “a political decision”
• Highlights of Mark Zuckerberg’s Libra testimony to Congress
• Transparency International reveals that UK services and institutions allowed 325 billion pounds of suspect transactions to flow through the country’s financial system

The AML’s Watch

• FINRA fined BNP Paribas $15 million for failing to develop an AML program that could detect suspicious penny stock and wire transfers
• Swedbank reported a bigger-than-expected drop in quarterly earnings, hit by the costs of dealing with the fallout of the money laundering scandal
• President of Crypto Capital arrested by Polish authorities for money laundering suspicions

Add this to your knowledge folder

• 5th AML Directive: impact and changes

Good reads

• USA’s regulatory moves to help combat kleptocracy
• Untangling the role of the FATF

About the Author:

Catarina Veloso is a legal counsel at Fractal and co-chair of INATBA’s identity working group — Catarina specialized in energy law and focused on how blockchain technology can contribute to the management of electricity grids; but an unexpected(-ly happy) turn of events lead her to work closely with Fractal’s product team to remove all the friction while keeping all the compliance in a global KYC/AML onboarding solution.