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Financial Crimes in the Digital Age Plague Aruba’s Financial Institutions
Aruba’s financial institutions are facing a growing threat from sophisticated financial crimes, exacerbated by the increasing use of new and emerging technologies. As the role of financial institutions becomes more critical in preventing, detecting, and deterring criminal activity, regulators and financial institutions must innovate and promote a culture of compliance to better protect their communities.
The Need for Innovation
A recent article series by KPMG explored the views of thought leaders on the future of financial crime, highlighting the need for a paradigm shift in the way financial institutions approach risk management. The series discussed the importance of moving away from “tick-box” compliance and instead adopting a more dynamic approach to know-your-customer (KYC) processes.
Digital Payments: A Major Contributor to Financial Crime Risks
The article also highlighted the rise of digital payments as a major contributor to increased financial crime risks, citing examples of sophisticated schemes aimed at obtaining and laundering illicit funds. Additionally, it emphasized the need for Virtual Asset Service Providers (VASPs) to strengthen controls and monitoring in response to inadequate customer due diligence and sanctions monitoring.
Automating Anti-Money Laundering Processes
In another article, KPMG experts discussed the importance of automating anti-money laundering (AML) processes, citing benefits such as cost savings, improved customer experience, and reduced risk. The series also touched on the evolving risks facing:
- Peer-to-Peer (P2P) and Decentralized Finance (DeFi) Service Providers
- Non-Fungible Token (NFT) Marketplaces
- Traditional financial institutions
The Fight Against Financial Crime
The fight against financial crime is becoming increasingly complex, with criminals exploiting new technologies and payment methods to perpetrate fraud. As Aruba’s financial institutions strive to stay ahead of these threats, it is essential they adopt innovative strategies and promote a culture of compliance to protect their communities and maintain trust in the financial system.
Managed Services for Financial Crime Compliance
In this context, KPMG’s managed services for financial crime compliance can help organizations achieve the highest level of integrity while managing the cost and risk of litigation, investigations, and regulatory enforcement actions.