Financial Crime World

Panama Fintech and Financial Crime Risks: A Growing Concern

Introduction

As Panama’s fintech industry continues to expand, concerns over emerging financial crime risks are escalating. Anti-money laundering (AML) subject persons must stay ahead of the curve to prevent illicit activities involving illicit funds.

Emerging Financial Crime Risks

  • Blockchain Technology: The anonymity and global reach of blockchain technology have made it vulnerable to misuse, particularly with virtual assets like privacy coins that obscure transaction details on the blockchain.
  • Non-Fungible Tokens (NFTs): NFTs’ subjective value and ease of manipulation make them conducive to money laundering and terrorist financing. A notable example is a former employee’s insider trading charges in June 2022.

Disinformation and Deepfake Technology

  • Fake News: The spread of disinformation has become more prevalent, with sensational news intended to capture readers’ attention rather than provide accurate information.
  • Deepfake Technology: This technology enables the production of convincing content that shows people saying or doing things they never stated or did. It is frequently used as a means of spreading disinformation and its detection is challenging.

Mitigating Emerging Financial Crime Risks

To address these risks, AML subject persons should:

  • Familiarize themselves with emerging technologies: Ensure their respective AML/CTF frameworks keep up with emerging risks.
  • Design mitigating controls: Identify and understand emerging financial crime risks to prevent illicit activities involving illicit funds.
  • Provide adequate employee training: Train employees on risk-based approaches to mitigating emerging financial crime risks.

Expert Guidance

Deloitte’s team can provide guidance on managing emerging risks and ensuring compliance with AML/CTF regulations. By staying informed and proactive, Panama’s fintech industry can minimize the risks associated with emerging financial crime trends while continuing to grow and innovate.

Conclusion

In conclusion, the growing importance of accurate, reliable, and relevant sources highlights the need for AML subject persons to refer to such sources and maintain adequate employee training on risk-based approaches. By taking proactive steps, Panama’s fintech industry can stay ahead of emerging financial crime risks and continue to thrive.