In July 2019, we held a week-long TechSprint to find better ways of increasing the detection and prevention rates of financial crime.
This issue is highlighted by every year: 800,000 people are trafficked into slavery, while around 40 million people are estimated to live under a form of modern slavery, including forced labour and prostitution. Vast sums are also generated each day through the sale of illicit drugs and the illegal wildlife trade.
The profits from these activities are laundered and legitimised through the global financial system – around $1.6 trillion a year or more, according to the United Nations, or between 2 – 5% of the world’s Gross Domestic Product. $90 billion through the UK alone.
Use cases
Our event focused on how encryption techniques known as privacy-enhancing technologies (PETs) can facilitate the sharing of information about money laundering and financial crime concerns, while remaining compliant with data security laws.
Over 140 active participants at the FCA’s offices and at a satellite office in Washington came together to develop solutions, using PETs, to the below use cases:
- How can a network of market participants use PETs and data analytics to interrogate financial transactions stored in databases within institutions to identify credible suspicions without compromising data privacy legislation?
- How can market participants rapidly and accurately codify typologies of crime, in a way that allows them to be quickly disseminated and implemented by other market participants in their financial crime controls?
- How can a market participant check that the company or individual they are performing due diligence on hasn't raised flags or concerns within another market participant, and/or verify that the data elements they have for the company or individual match those held by another market participant?
- How can technology be used to assist in identifying an ultimate beneficiary owner (UBO) across a network of market participants and a national register?
The solutions developed
Ten teams presented their solutions to an audience of regulators, academics, technology companies and financial institutions. To inject a competitive element into the event, prizes were awarded by a judging panel, with the teams being assessed on criteria including potential market readiness and effectiveness, creativity and the quality of their presentation.
The teams and solutions developed were:
