the full picture, this week – 12 October 2018

By Magalie Pimentel | October 12th 2018
the full picture this week - 12 October 2018 | encompass blog

the full picture, this week – 12 October 2018

by | Oct 12, 2018 | All Blog Posts, Featured

This week we dive into crypto businesses, looking at their impact on financial stability and moves to regulate the sector. Then it’s over to Australia and an ongoing cartel case against two global banks, tighter money laundering regulations coming into force in Europe and a look at why adoption of automation technology is increasing across organisations of all sizes.

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focus on…cryptocurrencies

Earlier this week, the Financial Stability Board issued a paper focused on crypto-asset markets, and their potential impact on global financial stability. The detailed report covers related risks and broader policy issues including anti-money laundering and combating the financing of terrorism (AML/CFT) regulation and supervision, including implementation of international sanctions, and regulatory measures to prevent tax evasion.

In preparation for it’s anticipated central role in digital currencies, and with an eye on the title of ‘Blockchain Island’, the Malta Financial Services Authority (MFSA) is tightening up controls and investing millions in AML supervision. According to, Christopher Buttigieg, head of the MFSA’s securities and markets supervision unit:

No one in the world can expect a regulator to guarantee a completely risk-free system. We would need an army of people on the ground. Regulatory work is a risk-based approach.

What we can promise, however, is market integrity and robust regulation. And, more importantly, zero tolerance to any abuse found.

The Monetary Authority of Singapore (MAS), is looking to bring traditional financial institutions closer to crypto start-ups in a bid to help new businesses access banking services. According to Regulation Asia, reluctance amongst banks to engage with crypto businesses is having an impact on the country’s proactive approach to fostering fintech innovation.

Sticking with Asia, Taiwan’s “crypto congressman”, Jason Hsu, is proposing an amendment to the region’s Money Laundering Control Act that would bring cryptocurrencies into scope. While Japan’s hardline approach to approving licences for crypto businesses has been welcomed by Coinbase as they look to enter the market.

Crypto is growing, but more slowly in Africa, and Coin Telegraph asks if South Africa could lead the charge on adoption. A fintech task force has been established and a soft approach to regulation is being considered, according to Bridget King, director of banking practice at the South African Reserve Bank,

Regulating cryptocurrencies prematurely could have the negative consequence of throttling the growth and innovation of the industry. In addition, if laws are drafted based on existing technology, which is still in its growth phase, there is a risk that the technology may have moved so much by the time the legislation is enacted, that the legislation is obsolete or requires updating almost immediately to align with the latest technology.

With new research estimating that poorly regulated cryptocurrency exchanges have laundered bitcoin, totaling 380,000 BTC or $2.5 billion at today’s prices, is it any surprise that regulation is a key focus?

financial crime and regulation

The Australian units of two global banks stand accused of criminal cartel conduct. Following an investigation by the Australian Competition and Consumer Commission the companies face significant fines, and the executives involved could be looking at custodial sentences.

A press release issued by The European Council announced the adoption of new, tougher measures against money laundering. The directive aims to disrupt and block access by criminals to financial resources.

In the UK, the subject of the first unexplained wealth order has been exposed, while an opinion piece in The Guardian asks if UWOs will be effective as a tool against money launderers.


A new report by Deloitte highlights the growth in the adoption of intelligent process automation (IPA), with 67% of large corporates implementing this technology internally. The benefits of IPA are multiple, including:

  • improved compliance (92%)
  • improved quality / accuracy (90%)
  • improved productivity (86%)
  • cost reduction (59%).

Interest in applications for blockchain technology also abounds, and a new report from Spiceworks found that 56% of large enterprises plan to adopt blockchain-enabled technology by 2020. 41% of those surveyed believed that IT automation will have the biggest impact on businesses.

The effectiveness of new technology is dependent on having the right talent within an organisation to drive adoption, and TechRepublic reports that employees of big banks are increasingly expected, if not required, to learn coding skills.

the latest from encompass

Over on our blog this week, legal industry advisor to encompass, Amy Bell, provides a primer on understanding source of funds and source of wealth.

And if you need to improve your understanding of intelligent process automation, our recent blog post, To Automate is Human, takes a detailed exploration of the rise and benefits of automation technology.

If you missed our recent webinar with OCEG and Thomson Reuters on the identification of ultimate beneficial owners (UBO), you can view the recorded version now [membership required]. If you wish to discover more around this topic, you can check out our UBO resource page.

meet the encompass team

Meet the team at Sibos 2018 taking place in Sydney from Monday 22 – Thursday 25 October. This year’s theme, Enabling the Digital Economy, will focus the financial industry leaders attending on digital transformation and technology. Get in touch today if you want to meet one of the team at Sibos 2018.

Are you attending the Intelligent Automation in Banking Summit in London on Wednesday 24 October? The encompass team will be joining some of Europe’s leading banking and industry leaders to learn about the latest trends in AI, IPA and Machine Learning.

Global Wealthtech Summit takes place in London on Wednesday 7 November. The team will be attending and are available to discuss your needs around technology and automation in wealth management and private banking.

We’ll be at Hong Kong FinTech Week later this month with our partner, and silver sponsor, TransUnion. Get in touch if you’d like to pre-arrange a meeting to discuss automating your Know Your Customer and due diligence processes.

The world of Know Your Customer (KYC), compliance and financial crime never sleeps, and if your challenges are keeping you up at night let us help. encompass robotically automates information and news discovery for KYC requirements for onboarding, event-driven refresh and remediation.

Driven by your internal policies, our platform automatically constructs corporate ownership structures, discovers beneficial owners, and in minutes screens all relevant entities and persons for regulatory, reputational and financial risk.

Author: Magalie Pimentel

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