Financial Crime World

Financial Institutions Face Increased Pressure to Prevent Financial Crimes in Saint Pierre and Miquelon

Regulatory bodies in Saint Pierre and Miquelon are stepping up efforts to combat financial crimes, placing increased pressure on financial institutions to adapt their risk management strategies and technology capabilities.

Growing Complexity of Financial Crimes

The growing complexity of financial crimes, including COVID-19-related frauds and cybercrime, is pushing firms to rethink their approach to detecting and reporting suspicious activity. Regulatory bodies are demanding evidence that Know Your Customer (KYC) programs are influencing detective capabilities and risk assessments.

Key Areas of Focus for Regulators

  • Alignment of Risk with Capabilities: Financial institutions must demonstrate how they are addressing emerging threats, such as medical scams and imposter frauds, which have become more prevalent during the pandemic.
  • Automation and Artificial Intelligence in Financial Services: Legacy data and systems problems are leading to long implementation timelines and difficulties in moving capabilities from the lab to production.
  • Sanctions Detection and Alert Management: Financial institutions must align their sanctions detection and alert management capabilities with the need for faster or instantaneous payments and digital currencies.
  • Enterprise-Wide Focus on Fraud and Financial Crime: Regulators expect firms to measure and respond to risks across business lines in a consistent and cohesive manner.

Other Concerns

  • Cybercrime and Ransomware: Account takeovers, ID theft, bot attacks, and synthetic ID fraud present significant risks. Regulators are raising expectations that firms will file suspicious activity reports for cybercrime and ransomware payments using cryptoassets.
  • Cryptoassets in Customer Accounts: Competitive pressure from emerging FinTech companies is pushing regulated firms to allow customers to hold cryptoassets, but most are not yet prepared to make the necessary changes to their financial crimes programs and technology.

Conclusion

Financial institutions in Saint Pierre and Miquelon must prioritize the development of robust financial crimes programs and technology capabilities to address the growing complexity of financial crimes and meet increasing regulatory expectations. By focusing on these key areas, firms can ensure compliance with regulations and protect themselves from emerging threats.