ISO 20022 Revisions: Enhancing the Fight Against Financial Crime

The Financial Action Task Force (FATF) has announced revisions to the ISO 20022 standard for financial messaging, aimed at strengthening international cooperation and data sharing in the fight against financial crime.

Strengthening International Cooperation and Data Sharing

The updated standard aims to facilitate the increased sharing of information between countries and financial institutions, enabling a more effective and coordinated approach to combating money laundering, terrorist financing, and other financial crimes. The revisions provide clearer guidance on data protection and technology requirements for private sector information sharing, addressing ongoing challenges in implementing standards for information sharing.

Setting a Global Baseline

The new standard is expected to set a global baseline for domestic and cross-border information sharing mechanisms, enabling financial institutions to achieve an even informational footing with criminals. This will help detect and prevent financial crimes more effectively.

Key Areas for Reform

Our research identifies several key areas where reform is needed:

• Standards for Information Sharing: Facilitating increased sharing of information and more effective use of financial activity, threat, and risk data linked to crime and terrorism.
• Data Privacy Considerations: Ensuring that data protection requirements are aligned with the needs of anti-financial crime efforts.
• Multilateral Cooperation on Financial Crime Data: Enhancing international cooperation and coordination in sharing financial crime data.
• Public-Private Partnerships: Strengthening collaboration between governments, financial institutions, and private sector organizations to combat financial crimes.
• Asset Recovery: Improving the recovery of stolen assets and returning them to their rightful owners.
• Fraud Detection and Prevention: Enhancing fraud detection and prevention capabilities through improved data analytics and machine learning techniques.
• Measurement of Effectiveness Combined with Prioritization in the Anti-Financial Crime Framework: Developing more effective metrics for measuring the success of anti-financial crime efforts.

Conclusion

By addressing these key areas, the revised ISO 20022 standard aims to provide a stronger foundation for international cooperation and data sharing in the fight against financial crime. The revised standard is expected to be implemented by financial institutions worldwide, providing a crucial step forward in the global fight against financial crime.