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Revolut: Comment from CEO of AML Specialists Kompli-Global

Comment on the call for a pan-European regulator for money-laundering

Comment from Jane Jee, CEO, Kompli-Global and Head of the Emerging Payments Association (EPA) Project Financial Crime.

Technology start-up, Revolut, has been no stranger to controversy in recent months. The unicorn has recently been in the headlines amid concerns about the source of some of its shareholders’ money, as well as calls for a third investigation into its Lithuanian banking licence, which was secured just last year.[1] Now, it has been accused of violating bank rules by switching off, for several months, an automated system which flags suspicious transactions that could indicate money laundering[2] – compliance questions that have led the CFO to resign[3].

The news, which quickly follows the release of a report from EU lawmakers highlighting a “lack of political will to tackle tax avoidance and financial crime” among many governments, clearly reflects the urgent need for a pan-European regulator to counter money laundering more effectively.[4] Without this level of consistency, companies may choose to base their operations in the jurisdiction with the lowest barriers to entry. Without this level of consistency, companies may choose the regulator with the lowest barriers to entry. One major concern is that young regulated fintech companies will be a magnet for money launderers because they do not have access to the data which is available to larger banks as FATF has identified in last year’s Concealment of Beneficial Ownership report[5].

To truly take the fight to the money launderers, EU governments need to step up and work together to combat criminal activity. In the meantime, businesses shouldn’t wait for regulators to act – they should look to safeguard their own operations from abetting money laundering. The technology is already available to help them do this – RegTech harnessing advanced machine learning (ML) in particular can continuously search global databases for adverse information on customers, helping to flag any links with bad actors or financial crime. Such tools are vital if we are to work together to protect society from the scourge of money laundering and its impact on ordinary people.

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