Banks, regulators and software suppliers should form an
alliance to agree common standards for technology to detect money
laundering, according to a submission to the Financial Services
Authority.
The call, from fraud detection software supplier Mantas, was
supported by Daniel Lessner, financial services technology analyst
at Datamonitor. Common standards in anti-money laundering
technology would help banks, he said.
Mantas has proposed agreed standards for both the functionality and
scope of anti-money laundering technology, such as the ability to
identify unusual patterns of customer behaviour. This would help
banks achieve compliance and make it easier for regulators to
enforce rules.
The firm issued the call in its response to a discussion paper
about money laundering published by City regulator, the FSA.
Regulators have clamped down on financial services firms that are
judged to have insufficiently robust procedures and systems to
detect and report potential money laundering. In December 2003, the
FSA fined high street bank Abbey a record £2m and, in 2002, the
Royal Bank of Scotland was fined £750,000, both for failing to meet
regulations to tackle money laundering.
Karen Van Ness, head of anti-money laundering management at Mantas,
said, "Institutions should be able to choose whatever technology
they want as long as it can meet [certain] criteria."
Mantas proposes that a steering committee co-ordinate the views of
regulated firms, law enforcement agencies, consultants and
suppliers to develop an industry standard.