Financial Crime World

Global Financial Crime Trends in Indonesia

Indonesia has been working tirelessly to improve its anti-money laundering (AML) and counter-terrorist financing (CTF) regulations following a history of being on the Financial Action Task Force (FATF) blacklist. The country hopes to become a full member of the FATF with various laws and regulations in place.

Indonesia’s Progress in Combating Money Laundering

As of February 2023, Indonesia has completed the mutual evaluation review as a requirement for full FATF membership. The FATF discussed and adopted the mutual evaluation report of Indonesia, concluding that the country has a strong legal, regulatory, and institutional framework, resulting in robust technical compliance in several areas.

Implemented Laws and Regulations

Indonesia has implemented various laws and regulations to combat money laundering and terrorist financing, including:

  • Law No. 3 of 2011
  • Law No. 5 of 2018
  • Law No. 8 of 2010
  • Law No. 9 of 2013

The Bank of Indonesia has also issued specific regulations, such as Regulation No. 14/27/PBI/2012 for Commercial Banks to implement Anti-Money Laundering and Combating the Financing of Terrorism Programs.

The Challenges of Implementing Effective AML Compliance

Despite these efforts, financial institutions in Indonesia face complex challenges in implementing effective AML compliance systems. The increased digitalization of services, growing amounts of data, and surge in regulatory pressure accentuate the pressure on financial institutions to implement effective AML compliance systems.

Non-compliance with AML regulations in Indonesia can result in fines of between IDR10 billion and IDR100 billion and prison sentences of up to 20 years. Therefore, it is essential for financial institutions to invest in robust AML compliance systems that can detect and prevent financial crimes effectively.

Traditional Solutions and Their Limitations

Traditional solutions for financial crime prevention, such as rules-based platforms, have been the norm for decades. However, these systems have limitations that hinder their effectiveness in combating money laundering. One of the main limitations is their siloed nature, which makes it difficult for institutions to have a comprehensive view of their transactions and customers.

Furthermore, traditional solutions often lack collaboration capabilities, preventing financial institutions from sharing information and best practices to stay ahead of evolving threats. This can also result in a reactive approach to financial crime prevention rather than a proactive one.

Tookitaki’s AFC Ecosystem

Tookitaki’s Anti-Financial Crime (AFC) Ecosystem is a unique and innovative approach to fighting financial crime. Unlike traditional solutions that rely on siloed systems and rules-based approaches, the AFC Ecosystem is a community-based platform that leverages the knowledge and experience of financial institutions, regulatory bodies, and risk consultants from around the world.

The AFC Ecosystem consists of a Typology Repository, a live database of money laundering techniques and schemes contributed by the community. These typologies cover a wide range of methods, from traditional techniques such as structuring to emerging threats like virtual asset service providers (VASPs).

Benefits of Tookitaki’s AFC Ecosystem

The community-based approach of the AFC Ecosystem provides several benefits to financial institutions:

  • A more comprehensive view of the financial crime landscape
  • Improved ability to identify and mitigate risks
  • Collaboration and sharing of best practices with other institutions
  • Proactive approach to financial crime prevention

Conclusion

Tookitaki’s AFC Ecosystem represents a significant step forward in the fight against financial crime, offering a collaborative and innovative approach that helps institutions stay ahead of the curve and protect against emerging threats. We urge financial institutions in Indonesia to embrace the future of financial crime prevention with Tookitaki’s AFC Ecosystem and book a demo for AMLS today.

With its community-based approach, federated machine learning, and comprehensive suite of solutions, Tookitaki is the future of financial crime prevention. Contact us today to learn more about how our solutions can help you stay ahead of evolving threats and regulatory changes.