New technologies are reshaping the way financial institutions identify and prevent illicit activity. In their latest expert commentary, Paweł Karp and Bartosz Segit, AML Practice Leads at Accenture Sp. z o.o., outline how the regulatory and institutional landscape must adapt as criminal networks increasingly leverage the same advanced tools.
The authors emphasize that financial crime has entered a stage where conventional compliance models are no longer enough. Institutions and regulators must shift toward proactive adoption of technology, recognising that the pace of innovation is now dictated as much by illicit actors as by the financial sector itself.
Addressing how AML frameworks can evolve quickly enough to remain effective, they note:
Given that technologies like AI, blockchain analytics, and PETs can be used by both regulators and criminals, how can AML frameworks evolve fast enough to counteract sophisticated misuse of these same innovations by illicit actors?
‘The Light Side of the Force’ must become more agile and adaptive. This involves several key strategies:
- Public-Private Collaboration: Regulators and financial institutions must work closely together to share intelligence on new criminal typologies and the misuse of technology. Cooperation must be real-time.
- Technological Race: Regulators and institutions must actively invest in the same technologies that criminals are using. This means leveraging AI for predictive analytics to identify emerging patterns of illicit activity, and using blockchain analytics tools to trace funds across decentralized networks.
- Focus on Outcomes: This means evaluating the effectiveness of an institution’s AML program based on its ability to detect and prevent financial crime, regardless of the specific technology used, not on producing and fulfilling multiple regulations. This flexibility allows institutions to rapidly adopt new tools.
- Promoting Privacy-Enhancing Technologies (PETs): Regulators should encourage the use of PETs that allow for the analysis of data and the detection of suspicious patterns without revealing the underlying sensitive personal information.
Their commentary highlights a broader market transition toward outcome-driven AML effectiveness, where the real measure of a system’s quality lies in its ability to stop criminal activity – not in the volume of procedural documentation it generates.
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