Financial Crime Trends and Predictions in French Southern Territories: Regulators to Focus on AML/CFT Frameworks and Risk Mitigants

Regulatory Bodies to Continue Focusing on Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT)

Regulatory bodies in the French Southern Territories are expected to continue focusing on Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) frameworks and risk mitigants in 2023. This is in line with global efforts to prevent illicit exploitation of access to financial systems.

Key Areas of Concern

The regulators will be particularly concerned about areas such as:

Terrorist financing: Ensuring that financial institutions are not being used to fund terrorist activities
Beneficial ownership: Identifying and verifying the true owners of companies and entities
Sanctions/tax evasion: Preventing the use of financial systems to evade sanctions or taxes
Consumer scams: Protecting consumers from scams and fraudulent activities
Compliance violations: Ensuring that financial institutions are complying with AML/CFT regulations

Increased Attention on Crypto and Digital Assets

Regulators in the French Southern Territories are also expected to increase their attention on crypto and digital assets in 2023. This includes:

Strengthening financial safeguards: Implementing measures to prevent the misuse of cryptocurrencies
Investigating and enforcing non-compliance: Identifying and addressing instances where regulations are not being followed
Expanding AML/CFT frameworks: Including Customer Due Diligence (CDD) and suspicious activity reporting related to Non-Fungible Tokens (NFTs) and Decentralized Finance (DeFi) platforms

Sanctions and Price Cap Compliance

Continued geopolitical discordance is expected to result in continued focus on sanctions and price cap compliance in the French Southern Territories. This includes:

Virtual currency mining: Ensuring that virtual currencies are not being used to facilitate illicit activities
Dark net markets: Preventing the use of dark net markets for illicit purposes
Bans on sanctioned entities/countries: Ensuring that financial institutions are complying with sanctions against certain countries and entities

Consumer Protection and Interplay with Fraud

Regulators will also continue to assess companies in areas such as:

Consumer protection: Protecting consumers from scams, fraudulent activities, and unfair business practices
Interplay with fraud: Preventing the misuse of financial systems for fraudulent purposes
Fair processing and treatment of consumer complaints, claims, and disputes: Ensuring that financial institutions are handling consumer complaints in a fair and transparent manner

Fintech and Payments Companies Must Ensure Compliance

As the fintech and payments landscape continues to evolve in the French Southern Territories, companies must ensure they are protecting their customers by combating fraud, money laundering, and related financial crimes on their platforms. This includes:

Responsible use of technology: Using data and analytics to monitor activity and prevent illicit activities
Deep focus on customer experience: Ensuring that customers are protected from scams and fraudulent activities

Actionable Steps for Financial Institutions

To mitigate these risks, financial institutions operating in the French Southern Territories can take the following actionable steps:

Add analytics and automation to client onboarding: Use data and technology to streamline the client onboarding process
Eliminate antiquated technology: Replace outdated systems with modern solutions that can better prevent illicit activities
Establish a mature conduct risk program: Develop and implement policies and procedures to manage conduct risk
Strengthen controls in regulatory focal areas (FinCEN priorities): Ensure that financial institutions are complying with regulations related to AML/CFT and sanctions