International financial services association BAFT announced a new working group aimed at increasing anti-money laundering efforts and helping the banking industry meet know-your-customer regulatory expectations.
The Anti-Money Laundering and Know Your Customer Trade Finance Sound Practices working group will review “red flags” identified by various regulatory bodies in different regions, as well as discuss common challenges and best practices.
“Addressing the challenges of financial crime while balancing the need for trade finance and payment services is one of the most pressing issues for the transaction banking industry,” BAFT President and CEO Tod Burwell said. “Increased regulatory requirements, significant fines for non-compliance, and shifting trade and payment flows have made it incredibly difficult and costly for banks to interdict 100 percent of the non-compliant transactions from the millions of transactions that support everyday commercial activity.”
BAFT, which includes membership by JPMorgan Chase, RBS, Citigroup, BNP Paribas, Wells Fargo, Deutsche Bank and other major financial institutions, will announce updates on various solutions at its upcoming conference in California next month.
“The industry spends hundreds of millions to fight financial crime,” Burwell said. “Shared solutions can both lower cost and improve consistency, but banks need to agree on best practice requirements.”