May 16, 2020

Can Libra deliver in the fight against financial crime?

Libra
Facebook
crypto
Blockchain
Neepa Patel, Chief Compliance ...
3 min
Neepa Patel, Chief Compliance Officer at blockchain firm R3, tells FinTech Magzine that theLibradebate deserves more attention than it is currently rece...

Neepa Patel, Chief Compliance Officer at blockchain firm R3, tells FinTech Magzine that the Libra debate deserves more attention than it is currently receiving because many don't fully understand or appreciate the potential blockchain has in fighting money laundering.

The cost of anti-money laundering (AML) to businesses globally is no secret, with institutions across the world dedicating time and money to fight financial crime. 

Even the world’s most upstanding economies have not been able to escape the blight of money laundering. Canada’s own problem has become known as “snow washing” – a reference to the country’s positive image tarnished by suspect transactions. 

Despite this, money laundering remains big business, representing around 5% of global GDP. That’s larger than the entire economy of Canada.

In its early days, many feared that blockchain technology - and the crypto assets it became synonymous with - would provide yet more protection for money launderers, cloaking assets behind a wall of anonymity. 

However, with the emergence of new generations of blockchains, like Facebook’s Libra, we may now have an opportunity to build an asset that can prove itself a weapon in the fight against financial crime, rather than a facilitator. 

This may come as a surprise to many, given the fiercely divisive debate Libra has spawned since it was announced in June this year. 

However, with a quick look at the way that financial institutions currently handle financial crime, it quickly becomes clear that blockchain-led solutions such as Libra present a much-needed solution to this growing epidemic. 

The way banks currently approach money laundering is largely reactive, relying on electronic monitoring to identify suspicious activity such as excessively large cash deposits, for example.

The problem is that information is often kept across multiple systems, giving neither banks nor regulators a comprehensive view over the whole network of interconnected payments, deposits and money transfers. 

The nature of blockchain, as a single connected ecosystem, means that information can be shared across a network, enabling banks to develop a more coherent and comprehensive view of activity. This means that AML analytics can build up a much more subtle picture, joining together activities which might not on their own seem suspicious but taken as a whole indicate nefarious activity.

So, if blockchain can actually enhance AML measures, why is Libra – not to mention cryptocurrency more broadly – seen as such bad news in the fight against financial crime?

SEE MORE: 

The key is to understand the difference between a permissioned blockchain – which requires users to be verified before they can join the network – and permissionless blockchain, which offers none of the same protection. 

Permissioned blockchains are by far the most effective way for the technology to deliver on its AML requirements. By creating an ecosystem that ensures participants have valid legal identities and where confidential data is safeguarded, this kind of network has the ability to deliver privacy and security at scale. 

The trouble is that cryptocurrencies – and blockchain more broadly – has become a victim of this little known and lesser understood distinction between permissionless and permissioned networks. 

With Libra facing intense regulatory scrutiny, Facebook now has a unique opportunity to deliver on its ambition to advance AML enforcement in the digital currency industry. If built on a secure foundation of permissioned blockchain, the asset could can set an example for future coin issuers and in doing so create new industry standards. Can Libra deliver? Only time will tell.

For more information on all topics for FinTech, please take a look at the latest edition of FinTech magazine.

Follow us on LinkedIn and Twitter.

Share article

Jun 18, 2021

The Ultimate FinTech & InsurTech LIVE Event

Fintech
Insurtech
live
event
3 min
We release three new speaker names for the FinTech and InsurTech virtual conference that can’t be missed, streaming live from London

From October 12th-14th, 2021, BizClik’s FinTech & InsurTech event will bring together influential executives from around the world. Streamed live from Tobacco Dock, London, this three-day event will be an excellent way to finish the year strong, gaining the confidence your company needs to move forward into the future. 

With keynote addresses from global leaders, dynamic roundtable discussions, and extensive networking opportunities, FinTech & InsurTech 2021 will expand your network, deliver insight, and enhance your organisation’s reach. 

Already confirmed speakers include Colin Payne, VP & NextGen FS Global Lead at Capgemini; Dipu KV, President and Head of Operations & CX at Bajaj Allianz General Insurance Company; Bryan Caroll, CEO at TNEX; and Lucy Demery, Managing Director at Barclays.

The event will include:

 

  • Keynote addresses from respected industry leaders
  • Dynamic live roundtables (inc. Q&A)
  • Fireside discussions
  • Inspirational Speakers & Presentations
  • Extensive networking opportunities

 

 

Meet the Speakers

Each week, from now until the event, we’ll be announcing the latest speakers who are set to grace our physical or virtual stage, prepared to share their knowledge and insight with attendees. 

Our second batch consists of:

 

Scott Abraham

Currently the Senior Vice President of Business Development & Fintech for Mastercard UK & Ireland, a position he’s held since 2014, Abraham describes himself as “a proven and successful senior sales leader with experience across a wide range of industries, sectors, and channels.” 

Graduating from the University of Northampton in 1994 with a BA in Economics and Law, he worked for nine years at Sainsburys - eventually responsible for banking the company’s revenue and running its ATMs - and then Barclaycard for three years as Head of Client Management. In 2007, Abraham became VP of Client Management at American Express, and then VP and GM Global Supplier Relations EMEA in 2012.

In his current role at Mastercard, Abraham is accountable for the acceptance of all payments and products through all channels, devices, and technologies across UK and Ireland. In addition, he oversees the deployment of innovative new payment tech within the region.

 

Alistair Fraser-Hawkins

Fraser-Hawkins’ role as CEO, UK Corporate, at Marsh McLennan is the continuation of a long and successful insurance career, which has included being London Sales Director for JLT Group and Branch Director for Willis Towers Watson.

Marsh prides itself on being a company that hires top-tier talent, does work that impacts peoples’ lives, and offers its employees the opportunity to make a difference. This is clearly an attitude that aligns with Fraser-Hawkins’ own values; regarding the insurer’s UK Young Professionals initiative, a support network to help young professionals in their development, he said:

"I am passionate about developing talent and our Young Professional CRG provides a brilliant community for our Young Professional colleagues to discuss key issues relevant early in their careers, as well as an environment to promote the skills, learning and network for success."

 

Mike Massaro

Massaro is currently the CEO of Boston fintech Flywire, a role he took on in 2013. He first joined the team in 2012 as VP of Business Development, but it wasn’t long before his entrepreneurial skills were redirected to leading the entire company’s high-growth strategy worldwide.

An expert in domestic and international payments and billing, enterprise technology sales, strategic alliances, enterprise software, SaaS, product management and marketing, and much more, Massaro is a consummate finance professional whose credentials befit the leadership of a prominent global payments fintech.

His previous positions include Consultant at PwC and Product Line Manager at Oracle, and he maintains a Mentor role at startup accelerator MassChallenge. He graduated magna cum laude from Babson College with a BS in Information Systems and Finance.

 

This event is set to be one of the year's most unmissable. If you want to get leading perspectives on the future of fintech and insurtech, go to Eventbrite and purchase your tickets now.

Share article