Financial Crime World

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Emerging Trends in Financial Crime in Mali: A Growing Concern

The landscape of risk management in Mali is undergoing a significant shift due to the emergence of new technologies and trends that are making it increasingly complex for anti-money laundering (AML) subject persons to detect and prevent financial crimes.

The Rise of Blockchain Technology

While blockchain offers a secure and transparent way of conducting transactions, it also presents an opportunity for malicious actors to exploit its characteristics, such as high transaction speeds and anonymity, to bypass centralised regulators and enforcement authorities. In Mali, where the absence of effective legislation, regulation, and enforcement in this regard is a concern, the use of blockchain technology poses a significant risk to the country’s cross-border financial crime prevention framework.

  • Privacy Coins: The emergence of privacy coins, which can further increase anonymity on the blockchain, raises concerns about money laundering, terrorist financing, and financial crimes.
  • High-Risk Transactions: Blockchain’s high transaction speeds and anonymity make it challenging for regulators to detect and prevent illicit activities.

Non-Fungible Tokens (NFTs)

While NFTs have the potential to change the landscape of digital ownership, they also pose risks related to money laundering, terrorist financing, and financial crime. The subjective value of NFTs makes them more conducive to these illicit activities, and their use as a means for obfuscating funds and facilitating ML/TF activities is a concern.

  • Subjective Value: NFTs’ subjective value makes them more attractive to malicious actors seeking to launder money or finance terrorism.
  • Anonymity: The anonymity of NFT transactions raises concerns about the ability to detect and prevent illicit activities.

Fake News and Online Disinformation

Fake news and online disinformation are becoming increasingly prevalent, with the internet being bombarded with sensational news intended to capture readers’ attention rather than provide accurate information. The rise of language-model AI systems like ChatGPT exacerbates these concerns, making it challenging for AML subject persons to identify reliable online news sources.

  • Sensational News: The proliferation of sensational news raises concerns about the spread of misinformation and its impact on financial crime prevention.
  • Language-Model AI Systems: The use of language-model AI systems like ChatGPT makes it challenging to distinguish between accurate and inaccurate information.

Deepfake Technology

Deepfake technology is another emerging threat that enables the production of convincing content that shows people saying or doing things they never stated or did. This technology has been described as the most serious artificial intelligence crime threat to society due to its potential to spread disinformation and deceive ‘know-your-customer’ mechanisms.

  • Convincing Content: Deepfake technology’s ability to produce convincing content raises concerns about its use in financial crimes, such as fraud and extortion.
  • Deception of KYC Mechanisms: The use of deepfake technology can deceive ‘know-your-customer’ mechanisms, making it challenging for regulators to detect and prevent illicit activities.

Mitigating Emerging Financial Crime Risks

To mitigate these risks, AML subject persons in Mali must identify and understand emerging financial crime risks and design mitigating controls to address corresponding risks. This includes familiarising themselves with emerging technologies, ensuring their employees are adequately trained, and referring to accurate, reliable, and relevant sources.

  • Familiarization with Emerging Technologies: AML subject persons should stay up-to-date with the latest developments in emerging technologies, such as blockchain and deepfake technology.
  • Employee Training: Employees should be trained on identifying and reporting suspicious activities related to emerging financial crime risks.
  • Accurate Sources: AML subject persons should refer to accurate, reliable, and relevant sources when making decisions related to financial crime prevention.

Deloitte has significant experience in the spheres of financial crime risk management and compliance and is well-equipped to assist AML subject persons in Mali with setting up frameworks intended to mitigate the risk of their services being misused for money laundering, terrorist financing, or financial crime.