On Wednesday, in the King’s Speech, the UK government presented a new Digital Identity Verification Services Bill to standardize digital IDs.

The UK government has introduced a new bill for online identity verification services, a commitment to support digital ID products and services from certified authorities. The country’s Digital Transformation and Smart Bill is one of the 39 recently legislated initiatives introduced by the government on Wednesday in the King’s Speech. The event outlined significant plans for the recently elected Labour Government led by Prime Minister Keir Starmer.

According to the newly passed Bill, online identity verification services will empower citizens to authenticate their identities or information to experience more transparent and frictionless online transactions, pre-employment checks, and buying age-gated services. For businesses, this legislation will lessen the burden by reducing the cost of meeting compliance, overcoming the risk of data breaches, and effectively onboarding customers.

At the same time, trade bodies and digital identity service providers have consulted with the government to structure DIATF’s legal role. According to the government, the country can experience an economic benefit of £600 million from passing this bill to secure citizens’ digital identities each year.

“Digital Verification Services will help people and businesses to make the most of identity-checking technologies with confidence and peace of mind,” the document states.

The Digital Information and Smart Bill (DISD) plans to introduce and enforce new reforms related to data-sharing standards while giving more power to the Information Commissioner’s Office (ICO). In addition to these amendments, other goals include setting up smart data schemes and streamlining digital public services, making it frictionless for customers to share their data securely with authorized third-party providers (ATPs). However, the published document lacks details on how businesses can store or share customers’ data while eliminating the risk of exploitation.

Before this bill was introduced, there were many debates about the government’s initiative to introduce digital IDs. After Starmer considered using digital identity to restrict illegal migration, the labor government developed the idea of national ID cards.

However, the position of the digital certificate still needs to be clarified. Despite the new digital ID initiatives, the country’s lawmakers and experts argue that digital identities are inevitable at some point.

Like other countries, the UK is playing its role in making digital identity mainstream. Before legislating the Digital Information and Smart Data Bill, the government emerged with a law called Data Protection and Digital Information (DPDI), which, however, failed for multiple reasons and was grounded in May 2024. If DPDI had been a success, it would have had the power to eliminate the Biometric and Surveillance Camera Commissioner Role.

After the DPDI enforcement in February, the Department of Science and Innovation and Technology conducted a survey of public opinion on the bill and found out that the concerns related to identity fraud along with government overreach remain. The survey also revealed that the public is also concerned if digital identity services become mandatory over time; their personal data can be easily accessible by non-UK-baked companies, leading to privacy breaches.

However, Tracey Follows, CEO of Consultancy Futuremade, said that Starmer’s government is all set to establish close relations with the European Union. This step will help the country enhance its digital ID movement by inspiring it with the EU’s digital identity interoperability project.

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Taiwan and Singapore enhance Anti-Money Laundering (AML) regulations for virtual asset service providers and banks, aiming to control the illicit flow of money through the country’s legal financial systems.

Taiwan’s parliament has brought up significant amendments to the country’s AML regulations, mandating cryptocurrency exchanges and Virtual Assets Service Providers (VASPs) to register for AML compliance, further taking strict actions against unqualified VASPs. 

Upon the enforcement of the new rule, individuals and businesses using or providing crypto services in the country must comply with AML laws and register their service capacity. However, failure to meet AML compliance requirements can result in a fine of up to $153,800 and imprisonment for up to two years.

According to the recently passed amendments, overseas crypto platforms are obliged to set up local entities along with applying for AML registration, or would face regulatory sanctions or penalties.

Currently, Taiwan requires VASPs to comply with Financial Supervisory Commission’s regulation inline with the AML framework since July 2021, otherwise, the cryptocurrency industry remains unregulated. Huang Mou-hsin, Deputy Minister of Justice stated that currently the regulatory authorities can only impose penalties on non-compliant VASPs.

Additionally, Kevin Chen, Secretary General of the Taiwan Fintech Association, stated that this time, it will be challenging for non-compliant crypto firms to meet the new AML requirements.

“They will face a state of ‘not knowing when the review standards will be finalized, leading to prolonged waiting. They may even have to start over once the registration standards are announced,” Cheng said. “Those that have completed AML registration may temporarily continue their operations, but they will inevitably face stricter reviews in the future,” he added.

Like Taiwan, Singapore is also seeking to standardize its regulations for the banking sector, aiming to stop illicit flow of money after the country witnessed a multi-billion dollar money laundering case.

However, the country already had strict anti-money laundering regulations, yet lenders vary in their execution of AML processes. The country has convicted all ten criminals involved in a $2.2 billion money laundering case, which was done through dozens of local banks.

“The money laundering case of the past year has not changed our growth trajectory nor our position on regulatory standards,” Chia said. Still, “what is needed is to set a clearer waterline of practices across the industry, rather than a tightening of standards and requirements.” Chia’s remarks confirmed earlier reporting by Bloomberg News on the move to come up with consistent standards in the banking sector.

The comments also highlighted the importance of maintaining Singapore’s reputation as a top global financial hub that is the most crucial reason for boosting businesses at banks. Assets managed by the banks spiked by 10% as compared to the last year. 

In response to a question, Chai said banks will continue to experience growth in assets despite the wealth flow having slowed after last year’s money laundering scandal. Singapore doesn’t “see things in terms of a race or competition with other centers”, he said, referring to rivalry with other wealth hubs like Dubai and Hong Kong.

In order to enhance the effectiveness of the banking sector’s fraud prevention systems, the Monetary Authority of Singapore (MAS) is all set to offer S$100 million in funding to financial institutions to fast-track AI and quantum computing projects. 

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Singapore and Europe have emerged with enhanced AML requirements for corporate services businesses and crypto assets exchanges to fight financial crimes.

Singapore’s regulatory authorities have brought up significant enhancements in the country’s anti-money laundering measures while introducing hefty fines for corporate service providers (CSPs) and increased restrictions for companies’ nominee directorships.

Parliament passed two bills on July 2nd, 2024, amending current CSP governing and Limited Liability Partnerships (LLPs) laws. These enhancements came after a debate in which MPs questioned Indranee Rajah, the Second Finance Minister, including queries on the new nominee director requirements. According to the latest changes, a CSP can only arrange a nominee directorship unless the nominee is a sole proprietor of a registered CSP. At the same time, entities breaching the law are subject to a fine of up to $10,000.

For the CSPs, the law mandates that they must ensure that the arranged nominees are “fit and proper,” else CSPs can face a fine of up to $100,000

Indranee Stated, “The fit and proper factors… would include assessing an individual’s conduct and compliance history, integrity and whether the person has the competency, capacity, and capability to fulfill his obligations as a (nominee) director. However, suppose the CSP has reasons to believe that this appointed nominee director is no longer fit and proper after the appointment. In that case, it should also take appropriate action, such as informing the company involved to replace the individual concerned.”

In response to the Workers’ Party MP Louis Chua, Indranee said that the proposed change to the law broadens the scope of supervising individuals with many nominee directorships, however, they don’t cap the number they can hold. Additionally, for suggesting a cap on nominee directorship, he said this could be “a blunt tool that is unnecessarily restrictive.” 

Indranee said that a cap “would make it difficult for individuals who are capable of fulfilling their obligations, despite holding more than the prescribed number, and who may have legitimate reasons for holding multiple nominee directorships simultaneously. At the same time, bad actors can always find ways to get around the prescribed number.”

She also said that the amendments were in development even before the country witnessed a $3 billion money laundering case in 2023. To overcome this, the Ministry of Finance and Accounting and Corporate Regulatory Authority (Acra) reviews the country’s AML compliance system to curb increasingly sophisticated financial crimes. However, in light of the recently updated, all businesses providing corporate services must register with ACRA as CSPs.

Said Indranee: “The widened coverage of Acra’s regulatory regime will ensure that all entities providing corporate services from Singapore, regardless of whether they serve local or foreign clients, have the same obligations in our fight against financial crime.”

The new amendments introduce more harsh penalties and fines. CSPs that fail to meet regulatory obligations or detect money laundering activities are subject to a $100,000 fine, up from $25,000. Companies and LLPs can face a fine of up to $25,000, up from $5,000, in case they fail to have updated information in their registers. For providing misleading or false information about the registers to ACRA, a whopping $25,000 fine will be imposed.

Along with other obligations, companies, and LLPs must also share information on nominee director arrangements with ACRA. She said, “This information will be useful to banks, CSPs, and other gatekeepers who may, for instance, wish to conduct additional checks on companies with many nominee directors or shareholders.”

Like Singapore, Europe has also amended its Travel Rule. According to the European Banking Authority’s (EBA) July 4th statement, the rule’s scope has been expanded to include Crypto Asset Service Providers (CASPs) and intermediaries.

From December 30th, 2024, the new Travel Rule requirements will come into effect, and all crypto exchanges operating in EU member states will be mandated to follow the guidelines. Under the updated requirements, exchanges are obliged to provide information regarding funds and crypto asset transfers to the EBA.

The amendment is a part of the EU’s commitment to secure the financial ecosystem from money laundering and terrorist financing. Due to blockchain’s decentralized nature, cryptocurrencies are being widely used for money laundering. Thus, EBA aims to ensure the traceability of crypto assets for investigation purposes. From the day of enforcement, all the payment services providers (PSPs), intermediary PSPs, CASPs and intermediary CASPs will have two months to meet the requirements.

EBA stated: “The deadline for competent authorities to report whether they comply with the Guidelines will be two months after the publication of the translations into the official EU languages.”

According to the new guidelines, customer data is to be gathered in order to identify the type of tractions linked to other transfers of service. Additionally, CASPs are also required to have definite policies regarding international payments or transfers.

The regulatory authority states that the guideline will offer long-term benefits and supports the EU’s existing Markets in Crypto-Assets (MiCA) law, aiming to develop unified regulations in the region.

The regulator added: “Its main objective is to make the abuse of funds and certain crypto-asset transfers for terrorist financing and other financial crime purposes more difficult, and to enable relevant authorities to fully trace such transfers where this is necessary to prevent, detect or investigate money laundering and terrorism financing (ML/TF).”

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On Friday, an international financial watchdog committed to securing the global economic system against money laundering and terrorist financing, the Financial Action Task Force (FATF), removed Türkiye from its gray list, handing over a code of confidence to the government due to their efforts of enhancing anti-money laundering (AML) systems to prevent money laundering processes.

A Paris-based firm published its latest report, citing the country’s new name and the acronym for anti-money laundering and combating the financing of terrorism. It said, “The FATF welcomes Türkiye’s significant progress in improving its AML/CFT regime.”  The organization said the country had strengthened its AML and CFT compliance programs to overcome the system loopholes highlighted by the watchdog, which caused Türkiye to land on FATF’s gray list in October 2021.

According to FATF’s key findings, the country has multiple unregistered money-transferring service providers, alleged involvement in sanctions evasion, weak oversight over Non-Profit Organizations (NPOs) linked to major financial crimes, and insufficient resources to prosecute criminal proceedings.

In addition to these shortcomings, the watchdog discovered that the country’s banking, construction, and property sectors were vulnerable to illicit financing of UN-sanctioned states and groups.

In its 2024 findings, the watchdog organization concluded that Turkey is “no longer subject to the FATF’s increased monitoring process” but that it “should continue to work with the FATF to sustain its improvements in its AML/CFT system, including by continuing to ensure its oversight of the NPO [nonprofit organization] sector is risk-based and in line with the FATF standards.”

It’s good news for Türkiye’s government, and the finance minister, Mehmet Simsek, posted on its social media, “We did it,” along with the country’s flag emoji, the moment when the decision was announced. Turkish Vice President Cevdet Yilmaz said: “With this development, international investors’ confidence in our country’s financial system has become even stronger. The decision will positively affect the financial sector and the economy.”

The FATF’s announcement of removing Türkiye from its gray list will help the government boost the country’s economy after years of high inflation, local currency depreciation, and inconsistent foreign investment levels.

Like Türkiye, India has also gained an outstanding outcome in FATF’s 2023-2024 Mutual Evaluation.  This report was adopted during the Singapore plenary meeting from June 26 to June 28, where the watchdog placed India in the “regular follow-up” category, a distinction shared by only four other G20 countries. This credit is a significant achievement for the country, followed by its tireless efforts to enhance AML and CFT measures. According to the Finance Ministry release, FATF has praised our collaboration in developing measures to mitigate risks emerging from money laundering and terrorist financing.

India’s effective measures include transitioning from a cash-based to a digital economy, limiting the threat of financial crimes, implementing JAM ( Jan Dhan, Aadhaar, Mobile) Trinity, increasing financial inclusion, and strengthening cash transaction compliance while creating transparent channels to trace digital transactions to reduce money laundering.

The international watchdog’s recognition highlights the Indian government’s efforts in taking rigorous and future-proof AML and CFT measures. Lastly, the country’s outstanding rating has enhanced its capacity to help other gray-listed countries improve their measures against terror financing and money laundering.

Unlike India and Türkiye, FATF has highlighted significant improvements in Kuwait’s AML and CFT measures. The FATF has addressed the government to understand the risk of crimes, improve investigation and prosecution abilities, and freeze illicit funds linked to money laundering or terrorist financing. These findings were identified during the watchdog’s sixth and final general session. Due to the shortcomings of the current AML and CFT mechanism, the country is under enhanced monitoring for such crimes.

While explaining the FATF’s enhanced monitoring process, Dr Mohammed Bouzbar, a Criminal Law Professor at Kuwait University, commented that it is a way of overseeing countries with significant loopholes in their money laundering detection laws or measures. This procedure ensures that the specified countries take effective measures to enhance their efforts to combat money laundering and terrorist financing.

“If a country fails to take the necessary measures within the specified time frame, it may face additional actions from FATF, including being placed on the gray or black list,” Dr. Bouzbar noted. “This could significantly impact the country’s reputation and ability to engage with the international financial system.”

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FINMA, SFC, and MAS fined multiple financial institutions over $1.5 billion for not complying with AML and CFT regulations.

Swiss Financial Market Supervisory Authority FINMA has alleged HSBC (Suisse) SA  Private Bank for anti-money laundering failings. This resulted from enforcement proceedings conducted by the watchdog in December 2021, which focused on the bank’s relationship with anonymous Politically Exposed Persons (PEPs).

“HSBC Private Bank (Suisse) SA operated two high-risk business relationships where it failed to carry out an adequate check of either the origins, purpose or background of the assets involved,” FINMA said in the release. “In addition, several high-risk transactions were insufficiently clarified and documented, making it impossible to establish the legitimate nature of these transactions.”

These suspicious transactions amounted to more than $300 million and were conducted between 2002 and 2015. They involved funds originating from government institutions, which were carried out from Switzerland to Lebanon and routed back to Lebanon. According to the BSBC statement to PYMNTS, the bank plans to appeal the decision.

“We acknowledge the matters raised by FINMA, which are historic,” the statement said. “HSBC takes its Anti-Money Laundering [AML] obligations very seriously, including complying with all laws and regulations in every market we operate. As we plan to appeal the decision, it would be inappropriate to comment further.”

The regulatory authority stated in its press release that the Bank is obliged not to form new business relationships with PEPs until they review its AML in-house controls associated with building relationships with high-risk or PEPs, checks related to categorization of risks presented by customers, and all these factors are being confirmed by an audit agent.

In addition, the bank is mandated to share details about the board of directors and executive management responsibilities and the criteria for assigning those details to FINMA.

Like FINMA, the Securities and Futures Commission (SFC) of Hong Kong has also taken more strict measures against fraudsters linked to crimes such as insider trading, market manipulation, and corporate fraud. 

Over the last 12 months, SFC has conducted 183 investigations and alleged more than 50 criminal charges against 20+ fraudsters. “We take proactive and resolute enforcement actions to protect investors, punish wrongdoers, and safeguard the reputation and integrity of our markets. Our strategic focus on high-impact cases helps us address key risks in financial markets and send strong deterrent messages,” SFC commented in the report.

To enhance the surveillance measures, the watchdog has issued more than 4,000 requests for trading and account records from trading brokers while posting an alert for investors to make them aware of highly concentrated ownerships associated with trading stocks.

“By leveraging our surveillance capabilities combined with data analytics, resources can now be directed towards cases of high impact and high strategic value that will have the desired deterrence effect,” the SFC said. The watchdog also states that its new investor verification system launched in 2023 has significantly impacted SFC’s ability to identify suspicious trading activities and patterns in real-time.

“The achievements we made and valuable experience gained over the years will stand us in good stead to steer Hong Kong’s capital markets,” said the SFC’s Chairman Tim Lui. “To this end, we remain steadfast in our commitment to ensuring market integrity and resilience in the face of emerging trends and new challenges at the local, regional, and global levels.”

Singapore has also taken strict measures to restrict criminals from manipulating the country’s banking system. Regulatory authorities have seized more than $1 billion from multiple accounts linked to 10 alleged individuals and 17 suspects in laundering illicit gains. The confiscated assets include cash, digital currencies, real estate, and other luxury items.

This case has highlighted the significant loopholes within the country’s financial system, making it an eye-opener for the regulatory authorities to enhance regulations on hedge funds and family offices. In addition, Singapore’s financial watchdogs have increased the closure of dormant organizations as a part of drives to fight money laundering activities.

The country is striving to curb money laundering from its financial system. Yet, it needs help to enhance its protection against crimes due to money laundering from crimes committed outside the country. Banks are identified as the most vulnerable sectors due to the widespread digital financial services offering electronic transfers.

Despite this alarming situation, Singapore’s Monetary Authority (MAS) has significantly changed the Payment Services Act, broadening the scope to cover Digital Payment Tokens (DPTs) while bolstering user protection. Furthermore, this amendment also empowers MAS to enforce AML and CFT laws on DPT service providers.

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In the new age of AI-powered musical impersonation, deepfakes and bots, an artist’s greatest asset in the digital world is their Name, Image, Likeness, and Voice (NILV). Today, identity verification is essential to ensure trust, integrity, and authenticity. .MUSIC and global identity verification provider Shufti Pro are partnering to authenticate the digital identity of the entire global music community to create a trusted ecosystem of verified artists, creators, industry professionals, organizations, businesses, and brands under the .MUSIC top-level domain. 

With support in over 200 countries, ShuftiPro offers an identity verification solution that globally validates people and organizations using a combination of government IDs and biometrics. For Shufti Pro, the go-to experts for identity verification in highly regulated industries like banking, fintech, and healthcare, .Music is a first-of-its-kind partnership in a completely new space.  

“We are so happy and proud to join forces with .MUSIC and support their global mission of ensuring a safe and secure online environment that will promote trust, cooperation, opportunities, and legitimacy for the global music community,” states Shufti Pro CEO Patrick Cox. “At ShuftiPro, we have the technology and the means to support .MUSIC and we are fully committed to this mission.”

While critical work is being done to develop policies protecting artists and their NILV against deepfakes and stolen IP, legislation takes time to pass and only has a national effect. Shufti Pro’s ID verification is cross-platform and global–providing far-reaching protection. Thanks to this new partnership with Shufti Pro, all companies and individual members who register a .MUSIC domain will be vetted and their identities verified. By ensuring that every .MUSIC domain is owned by the creator or brand who claims to own it, the two companies will create a safe, secure, and transparent music ecosystem in which everyone can easily determine who is sharing any information or content.

“This collaboration is a critical development for safeguarding the music community’s digital identity and creating a trusted, secure and authentic music-centric Internet for the global music community and industry to safely connect, engage and transact,” says .MUSIC Founder and CEO Constantine Roussos. “Having a verified global music identity is the only way to streamline royalty collection and the licensing process of obtaining NILV permission directly from the authorized source to enable proper provenance, attribution and compensation.”

“Our partnership with .MUSIC marks a pivotal moment for global identity verification in the music industry,” says Cox. “We are excited to set a new industry standard for identity authentication for artists, bands, industry professionals, organizations and other members of the global music community.”

After more than a decade-long battle to secure the exclusive rights to the .MUSIC top-level domain name, the .MUSIC registry is launching globally. For the first time in the Internet age, the global music community and industry will be able to register their .MUSIC names in a trusted, secure, and safe manner without the fear of impersonators, cybersquatters, or AI bots. 

The global launch of .MUSIC has started with great anticipation and excitement, with many famous music artists and brands registering their .MUSIC names. These include Taylor Swift, Lady Gaga, Prince, Jimi Hendrix, James Brown, Whitney Houston, Universal, Sony, Warner, Spotify, Soundcloud, Deezer, Tencent, Ticketmaster, Live Nation, Apple, Google, YouTube, Meta, Facebook, Instagram, WhatsApp, Amazon, Twitch, Reddit, Coachella, iHeart, CBS, NBC, MGM, Shopify, Hilton, Uber, BMW, Rolex, Prada, Andreesen Horowitz, a16z and many others.

“We are committed to ensuring that every verified artist and music community member is able to interact in a secure, authentic and genuine digital space,” says Marina Roussou of id.MUSIC, the exclusive global identity provider for .MUSIC. “Verified MusicIDs will enable artists to protect their name, image, likeness and voice against AI deep fakes, impersonators and bots to preserve the integrity of everyone in the music industry.”

About Shufti Pro
Shufti Pro is a leading global identity verification provider that helps businesses verify identities, documents, and accounts, covering KYC, KYI, KYB, and AML solutions. The company’s 17+ identity verification solutions are trusted worldwide by 1000+ businesses belonging to industries varying from finance to insurance and e-commerce. Shufti Pro extends document verification in 150+ languages, with the ability to validate 10,000+ IDs in 240+ countries and territories within seconds.  By adopting AI-focused automation and the latest technological tools, Shufti Pro secures business processes like client onboarding, account opening, and digitization through award-winning identity verification services with an accuracy of up to 99%. For more information, visit: https://www.shuftipro.com 

About .MUSIC

.MUSIC is the trusted, safe and secure top-level domain name and verified MusicID for the global music community and industry. The .MUSIC initiative is a global music community-based and industry-led effort to create .MUSIC top-level domain with music-tailored policies and enhanced safeguards to protect intellectual property and the rights of creators globally, giving them full control of their music works. The .MUSIC top-level domain provides a music-centric Internet, a thriving, vibrant, and innovative place that promotes legitimate music creation, access, and distribution, where the global music community securely connects, interacts and transacts. For more information, visit: https://www.registry.music

About id.MUSIC

id.MUSIC is the exclusive music identity provider (IDP) for the .MUSIC top-level domain name serving the global music community and industry. id.MUSIC provides a verified global MusicID to to protect music artists’ Name, Image, Likeness and Voice (NILV) rights and address impersonators, AI cloning, bots and deepfakes. For more information, visit https://www.id.music  

For media enquiries, contact media@my.music

For more information, please contact

Lance Hood
Chief Marketing Officer | Shufti Pro

Identity verification solutions are well-known in regulatory compliance environments, particularly for Know Your Customer (KYC) programs supporting Anti-Money Laundering (AML) efforts. But the threat of identity fraud touches many aspects of our modern lives, from bank account opening and securing medical records to online reputations and career prospects. 

Unfortunately, rapidly advancing technology is driving the perception of identity mistrust from a “compliance issue” to an everyday threat. One of the major propellants for this technological shift is the rise of AI-generated deep fakes, making it easier for people with ill intent to mimic real people, create fake accounts or manipulate authentication checks to break into existing accounts. 

Art, acting, and music are examples of professions that are being profoundly affected by AI-based deepfakes. Clara Alex notes in her article, Kill the DJ, “Endless AI covers on YouTube and AI-generated scam ads with celebrities touting things they’d never tout are just a few cases to name. But the good news is that the industry, as well as content hosting platforms and social media are at least trying to fight it.”

As the article indicates, that fight involves identity verification becoming a mainstream phenomenon – with positive far-reaching implications. For example, cultural icons like Taylor Swift and Lady Gaga – as well as industry giants like Live Nation and Spotify – pre-registered for ICANN-accredited .MUSIC domains, paying a one-time $1.99 identity verification fee. 

The .MUSIC platform onboarded Shufti Pro to verify its entire community before getting them onboard. By ensuring that every .MUSIC domain is owned by the creator or brand who claims to own it. Shufti Pro is envisioned to create a safe, secure, and transparent music ecosystem where everyone can easily determine who is sharing information or content. “This collaboration is a critical development for safeguarding the music community’s digital identity,” says .MUSIC Founder and CEO Constantine Roussos, as noted in a Music Connection article.

The same principles that safeguard musicians apply to any business that creates consumer accounts. Confidence in identity is foundational, whether ensuring trust between buyers or sellers in an online auction; verifying ownership of social media accounts and associated statements and videos from that account; or protecting financial assets from theft or money laundering. For a business to thrive, it must break free of identity mistrust and focus on its most important assets. 

Identity verification services are crucial to mitigate deep fakes and ensure that businesses and consumers can thrive in an environment of greater trust. At Shufti Pro, we’re excited to support .MUSIC with our state-of-the-art identity verification solutions. Customers and businesses will have the freedom to thrive because identity verification is not just about compliance anymore. 

Myanmar, Nigeria, and Türkiye are implementing effective measures to level up anti-money laundering and counter-terrorist financing frameworks to exit FATF’s grey list.

Nigeria is all set to exit FATF’s grey list. To meet the regulatory requirements, the country has signed MOUs with the Kingdom of Bahrain, the Sultanate of Oman, and the Democratic Republic of Congo. 

According to the Nigeria Financial Intelligence Unit (NFIU) statement, these MOUs were systematically designed to facilitate the exchange of information while establishing strategic partnerships to fight money laundering and terrorist financing activities.

Mohammad Shahid Ahmed, the Chief of Staff at NFIU, has been appointed as the Vice Chairman of the Egmont Group. The Director and CEO of NFIU, Hafsat Abubakar Bakari, is at the forefront of this global campaign, aiming to remove the country from the FATF list. According to the NFIU’s statement, signed by Sani Tukur, head of the strategic communications office, Bakari recently led a powerful delegation at the Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA), marking his expertise to carry out such activities effectively.

Like Nigeria, Myanmar actively follows and implements the FATF’s Recommendations to avoid being grey-listed. Despite not being an official FATF member country, Myanmar is part of the Asia-Pacific Group on Money Laundering (APG), a regional regulatory body that oversees financial regulations.

Every country, including Myanmar, must meet the FATF’s 40 Recommendations, covering critical areas like Anti-Money Laundering, Counter-Terrorism Financing, and Targeted Financial Sanctions linked to proliferation. 

At first, the country was non-compliant with more than 20 out of 40 recommendations; however, it has now successfully met 24 of the FATF’s standards. 

The country’s membership in the APG allowed it to align local regulations with the international AML and CTF standards. Myanmar has already developed a National Action Plan to further implement the recommendations. The Central Bank of Myanmar (CBM) states that being identified as a high-risk country, the government has strictly prohibited currency market manipulations, and hefty penalties are structured for fraudsters. In 2017, Myanmar was included in the FATF’s high-risk countries subject to rigid inspection in 2023.  Since then, the government has made continuous enhancements to meet the low standards set by FATF. In 2023, APG confirmed that the country had improved 25 standards out of 40 recommendations.

Like other grey-listed countries, the Türkiye government has finally decided to legislate laws concerning digital currencies, with the proposal approved by Parliament’s Planning and Budget Committee. The country has high hopes to exit FATF’s grey list at its annual meeting in Singapore on Jun 28, 2024; however, Ankara has been accused multiple times since 2021 of failing to meet fundamental reforms associated with money laundering and terrorist financing. 

Various reports have surfaced indicating multiple terrorist organizations have been using intermediaries in the country, cash transfer apps, and cryptocurrencies to fund illicit activities. The country has proposed to amend Capital Market Law, introducing a new regulatory framework for Virtual Assets Service Providers (VASPs). Under the new framework, all the crypto assets service providers and platforms will require authorization from the Sermaye Piyasası Kurulu (SPK).

However, platforms operating in the country without authorization will be subject to regulatory penalties and imprisonment.

In addition, crypto asset service providers will be held accountable for illicit activities such as money laundering, terrorist financing, or data breaches. At the same time, the board of directors of the alleged platforms will be subject to an embezzlement provision if found guilty.

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International financial watchdogs have imposed a fine of over $500 million on TD Bank, Adelaide Casino, and SBI for non-compliance with anti-money laundering regulations.

The federal court has imposed a fine of $67 million on the Adelaide casino over a money laundering probe brought on by the Australian Transaction Reports and Analysis Centre (AUSTRAC). The civil action against the casino found that it failed to meet Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regulations.

A representative from AUSTRAC said that “Australia’s free and open economy can be exploited by bad actors to launder illicit funds, and money laundering remains an intractable issue that comes with significant harm to the public. SkyCity admitted that its contraventions made it vulnerable to criminal exploitation and exposed the Australian community and financial system to money laundering and terrorism financing risk.”

In addition to this, the spokesperson also stated that the company failed to comply with due diligence measures, which has allowed high-risk entities to launder millions of dollars through the casino.

“In ways that made the source and ownership of the funds unclear,” AUSTRAC said.

“It failed to carry out required checks on 121 customers, including where SkyCity knew customers were the subject of law enforcement interest, or where there were indications that some posed a higher risk of money laundering.”

Peter Soros, acting chief executive of AUSTRAC, said like other financial businesses, casinos need to meet AML obligations seriously.

“Criminals will always seek to take advantage of the gambling sector to clean their dirty money,” Mr Soros said. “Today’s result shows AUSTRAC is prepared to take action when businesses, including casinos, fail to comply with the legislation. Businesses who ignore their obligations are affecting the Australian community by leaving the door open to criminal activity.”

Sotos LLP in the Ontario Superior Court of Justice alleges TD Bank for failing to adequately disclose its ineffectiveness in in-house AML Controls, resulting in a $450 million penalty. A proposed shareholder class action is underway against the alleged bank, its directors, and its officers. This further resulted in the dropping of its stock price.

“Despite knowing of the significant regulatory risks, TD exhibited systemic deficiencies in its AML controls since at least 2012. The seriousness of TD’s lax AML controls, particularly in its U.S. operations, were notorious within TD,” the suit alleged.

“These deficiencies had been, and throughout the class period continued to be, exploited by criminal organizations, including drug traffickers, to launder hundreds of millions of dollars and transfer the proceeds of crime across international borders using basic methods that should have been flagged by properly functioning AML controls,” the filing said.

On Friday, a local branch of the State Bank of India (SBI) was fined $970,000 by The Hong Kong Monetary Authority (HKMA) for failing to comply with AML and CFT regulations. The lawsuit followed the regulatory authorities’ investigation between April 2012 and November 2013 to identify whether the bank had compliant internal controls.

According to the investigation’s key findings, the SBI branch failed to carry out customer due diligence measures as obligated by the HKMA before making ties with 28 corporate clients. The bank also could not monitor customer activities as a whole, not establishing and maintaining procedures to determine customer risk and PEP status.

Siddhartha Sengupta, SBI’s head of international operations and managing director, said the bank was not involved in money laundering or suspicious transactions. Still, the regulatory actions were triggered due to gaps in in-house controls at the SBI’s branch.

“This was a case of internal control failures relating to AML/CFT systems. The HKMA takes such failures seriously and wants to send a clear message to the industry that all authorized institutions should have effective AML/CFT systems and controls in place to, among other things, detect and report suspicious transactions based on their knowledge of their customers,” Meena Datwani, director-general (enforcement) at the HKMA, said in the order.

“These are fundamental to combating money laundering and terrorist financing and thereby maintaining the integrity of the banking system and the reputation of Hong Kong as an international financial center. The HKMA will take appropriate enforcement action to deter any lapses in this regard,” she added.

“SBI UK has taken very positive and intensive remediation work to address the contraventions identified in the HKMA’s investigation and other weaknesses identified in the HKMA’s onsite examination,” said the order.

Suggested Reads:

https://shuftipro.com/news/singapore-cyprus-and-the-us-expedite-efforts-to-combat-financial-crimes-effectively/

https://shuftipro.com/news/mfsa-sec-along-with-fca-introduces-new-aml-guidelines-for-money-laundering-officers-and-virtual-asset-service-providers/

https://shuftipro.com/news/sra-indias-fiu-and-the-acma-issue-non-compliance-fines-exceeding-2-million/

Singapore, Cyprus, and the US are stepping up their efforts to curb financial crimes while aiming to make the global financial system risk-free and future-proof.

Cyprus and the US have signed a memorandum of cooperation to enhance their efforts in curbing financial crimes. The Cypriot Council of Ministers announced this agreement after Nicosia publicized its collaboration with the United States. The memorandum aims to assist law enforcement authorities in investigating sanctions, violations, corruption, and money laundering cases.

The council’s decision to establish cooperation between the Cyprus Police and the FBI aims to speed up crime investigations while limiting money laundering activities.

According to the announcement, the memorandum’s conclusion “reflects the government’s efforts, particularly the determination of the president of the republic himself, to further strengthen the capacity of the country’s law enforcement authorities to address illegal financial activities and to detect and prosecute financial crimes.”

It will focus on exchanging knowledge about investigation methodologies, tactics, and techniques while ensuring the highest standards of confidentiality and data protection.

Like Cyprus and the US, Singapore has also increased its efforts to curb financial crimes. The Monetary Authority of Singapore (MAS) launched the Collaborative Sharing of Money Laundering /TF Information and Cases (COSMIC), an online platform to improve the financial system’s defense against financial crimes.

The platform serves as a centralized hub for sharing customers’ information among financial institutions and watchdogs, aiming to determine and mitigate potential risks associated with them.

The COSMIC participants may only be able to share the customer information with the other participants in case if the client’s profile displays suspicious indicators or red flags. MAS’s assistant managing director, Loo Siew Yee, said, “COSMIC will enable FIs to warn each other of suspicious activities and make more informed risk assessments on a timely basis. It complements the industry’s close collaboration with MAS and law enforcement authorities to combat financial crime. This will strengthen Singapore’s capabilities to uphold our reputation as a well-regulated and trusted financial center.”

The MAS and the country’s six prominent commercial banks, including the Development Bank of Singapore (DBS), Oversea-Chinese Banking Corporation (OCBE), United Overseas Bank (UOB), Citibank, the Hong Kong and Shanghai Banking Corporation (HSBC), and Standard Chartered Bank, collectively worked together through the development phase. 

The above-mentioned banks are among the early participants of COSMIC, majorly focusing on three critical factors in commercial banking: trade finance for illegal activities, proliferation financing, and misuse of legal entities.

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MFSA, SEC, Along with FCA Introduces New AML Guidelines for Money Laundering Officers and Virtual Asset Service Providers

https://shuftipro.com/news/uae-imposes-strict-penalties-for-aml-and-cft-failings/

https://shuftipro.com/news/india-and-the-united-states-collaborate-to-combat-financial-crime/