{"id":86,"date":"2016-07-15T16:38:52","date_gmt":"2016-07-15T16:38:52","guid":{"rendered":"http:\/\/new.altassets.net\/fintechforum\/?p=86"},"modified":"2018-02-09T16:12:15","modified_gmt":"2018-02-09T16:12:15","slug":"fintech-global","status":"publish","type":"post","link":"https:\/\/fintech.global\/globalpaytechsummit\/fintech-global\/","title":{"rendered":"RegTech is coming \u2018out of the cold\u2019 to ease the pressure on compliance teams"},"content":{"rendered":"

The regulatory environment is creating the perfect storm for RegTech to \u2018come out of the cold\u2019 and help solve real challenges according to Anthony Quinn, founder of Arctic Intelligence and co-founder at AML Accelerate.<\/span><\/strong><\/p>\n

New laws introduced since the global financial crisis in 2008 are constantly being updated, causing mounting pressure on compliance teams to keep on top of managing multiple regulations and multiple regulatory relationships.<\/span><\/p>\n

There are also major implications\u00a0resulting from\u00a0the global expansion of money laundering and terrorism financing laws, which are increasing the \u2018regulated community ten-fold\u2019 according to Quinn.<\/span><\/p>\n

\u201cThis creates capacity issues for regulators and globally impacts millions of businesses that have never been subject to these laws,\u201d he added. \u201cThey don\u2019t have the knowledge or capabilities at this point to identify, assess, mitigate and manage the ML\/TF Risk exposure or create an AML Program proportionate to the identified risks.\u201d<\/span><\/p>\n

There have also been many conduct risk failings, like money laundering, bribery and corruption, tax evasion, market rigging, insider trading and irresponsible lending. This results in \u2018unprecedented consequences\u2019 i.e. fines; falling share prices; class actions; board reshuffles and CEO sackings.<\/span><\/p>\n

As a result, the environment is causing a push for accountability by boards and executives on compliance, \u2018making for a marked shift in RegTech\u2019 according to Quinn.<\/span><\/p>\n

In the first three quarters of 2017 there has more than $523m invested in the global RegTech sector, with more than 48 deals completed according to data by FinTech Global.<\/span><\/p>\n

\u201cAfter a long time in the cold RegTech is recognised as being a way of effectively managing risk exposures and addressing the need for transparency in actions organisations are taking to address risk and compliance matters,\u201d he added.<\/span><\/p>\n

Regulation Nightmare On The Horizon<\/span><\/strong><\/p>\n

Next year is set to be a nightmare for financial institutions, with those responsible for compliance and mitigating risk facing a wave of new regulations.<\/span><\/p>\n

The second Markets in Financial Instruments Directive (MiFID II), a follow up to MiFID, which was First introduced by the EU in response to the 2008 financial crisis, is set to come into force in January.<\/span><\/p>\n

In the same month, the second Payment Services Directive\u00a0(PSD2) will also be implemented. Four months later, GDPR (the EU\u2019s General Data Protection Regulation) will come into effect.<\/span><\/p>\n

With the regulatory landscape continuing to cause problems for the industry, innovation in technology is seen by many as the solution. The application of blockchain, machine learning and data analytics can take regulated industries \u2018pretty far\u2019, according to Quinn, especially in the area of data analytics.<\/span><\/p>\n

\u201cMany compliance teams spend a huge amount of time gathering data for internal and external reporting purposes. \u00a0Because of many banks having disparate and legacy systems most time appears to be spent gathering rather than analysing, interpreting and responding to data. \u00a0This will lead to greater efficiency, transparency and ultimately better decision making.\u201d<\/span><\/p>\n

The impact of machine learning and artificial intelligence in regulatory compliance is \u2018too early to tell\u2019, there have been a lot of experiments going on now about machine readable regulations, cognitive learning systems to improve efficiency.<\/span><\/p>\n

\u201cI see that continuing, simply because some major Banks have over 30,000 people now in compliance, often working in routine, mundane and low-value add activities that could in future be largely automated. By largely I mean many organisations will need to train machines, over-ride where pragmatic and tune\/fine tune them,\u201d he said.<\/span><\/p>\n

Read the full story at <\/span>RegTech Analyst<\/span><\/a><\/p>\n

RegTech Analyst is the pre-eminent provider of data, research and analysis on the global RegTech market. We cover every trend, every investment and profile every company that provides a technology solution for compliance, risk management or cybersecurity. We deliver essential intelligence for mission-critical business decisions.<\/span><\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

The regulatory environment is creating the perfect storm for RegTech to \u2018come out of the cold\u2019 and help solve real challenges according to Anthony Quinn, founder of Arctic Intelligence and co-founder at AML Accelerate. New laws introduced since the global financial crisis in 2008 are constantly being updated, causing mounting pressure on compliance teams to… <\/p>\n

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