Digital Frontiers

AML-CFT

ARTICLES

KYC Innovations, Financial Inclusion and Integrity in Selected AFI Member Countries

It is estimated that approximately one billion people across the world do not have access to an officially recognizable identity. The accurate verification of identity is integral to the Know Your Customer (KYC) processes necessary for compliance with Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) regulation. The inability of financial institutions to properly verify…

Inclusive Integrity Toolkit

Countries in the sub-Saharan Africa (SSA) region have been on a development curve in setting up effective Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulatory responses that meet the international Financial Action Task Force (FATF) standards. This toolkit is the first of its kind and benefits from extensive comments and reviews from FATF as…

Risk-based Customer Due Diligence

in the context of policies on anti-money laundering and combating the financing of terrorism (AML/CFT), advancing financial inclusion poses special challenges. Regulation must protect the integrity of financial systems and, at the same time, put the least burden on outreach to poor people and the unbanked. Achieving this balance requires a risk-based system of customer…

Risk-Based Customer Due Diligence: Regulatory Approaches

Regulators face a challenge in balancing policies on anti-money laundering and combating the financing of terrorism against placing the least burden on outreach to the poor and unbanked. This Technical Note provides guidance on using risk-based approaches to customer due diligence (CDD), supported by examples drawn from around the world. There are three regulatory options for employing…

Suptech Applications for Anti-money Laundering

Suptech, or the use by financial authorities of data collection or advanced data analytics tools enabled by innovative technologies, seems more advanced in the field of anti-money laundering (AML) and combating the financing of terrorism (CFT). In particular, AML/CFT authorities need suptech-enabled advanced data analytics tools to analyse large volumes of information at their disposal.…

Beyond KYC Utilities: Collaborative Customer Due Diligence

The private and public sectors are increasingly leveraging new technologies to deliver collaborative approaches for financial service providers (FSPs) to meet customer due diligence (CDD) requirements. These include sharing data and elements of compliance functions on a level that was previously unthinkable. By pooling resources, these collaborative approaches have the potential to lower CDD costs…

Anti-Money-Laundering (AML) & Countering Financing of Terrorism (CFT) Risk Management in Emerging Market Banks

For banks in emerging markets, the regulatory landscape is more complicated than ever. Rules  designed to fight money laundering and root out terror finance have made the financial system safer  and more resilient but have also increased the cost and complexity of doing business in developing countries—with negative consequences for cross-border trade and the networks…

Illicit Financial Flows: A Financial Integrity Perspective

Addressing Illicit Financial Flows (IFFs) is a target in the Sustainable Development Goals (SDGs). This article by Cenfri explores the different definitions of IFFs, challenges of quantifying IFFs, and the impact they have on financial integrity. Read more here.

FATF Guidance on AML/CFT Measures and Financial Inclusion, with a Supplement on Customer Due Diligence

The FATF recognises that applying an overly cautious approach to anti-money laundering and countering the financing of terrorism (AML/CFT) safeguards can have the unintended consequence of excluding legitimate businesses and consumers from the formal financial system.  In 2013, the FATF published the Guidance on AML/CFT Measures and Financial Inclusion, which provided support for designing AML/CFT…

Proportional risk-based AML/CFT regimes for mobile money: A framework for assessing risk factors and mitigation measures

This publication from GSMA aims to help regulators understand the risks posed by mobile money services and the measures mobile money service providers are taking to mitigate these risks, both of which can help inform the design of efficient and proportional AML/CFT regulations. This publication will also help assessors understand mobile money services and the…

Mobile Money: Methodology for Assessing Money Laundering and Terrorist Financing Risks

Mobile money services are currently being deployed in many markets across the world. There is strong evidence that these services can improve access to formal financial services in developing countries. However, their rise has prompted concerns that mobile money services will be used for money laundering and terrorist financing (ML/TF). Whilst to date there has…

Fraud Detection in Mobile Payments Utilizing Process Behavior Analysis

Generally, fraud risk implies any intentional deception made for financial gain. This paper considers this risk in the field of services which support transactions with electronic money. Specifically, it applies a tool for predictive security analysis at runtime which observes process behavior with respect to transactions within a money transfer service and tries to match…

Developing and Implementing AML/CFT Measures Using a Risk-Based Approach for New Payments Products and Services

This paper analyses and explains FATF’s Risk-Based Approach (RBA) for new payment methods to support countries and institutions in their efforts to use a RBA to improve financial inclusion.