The Chief Executive
All Authorized Institutions
Dear Sir / Madam,
I am writing to share the captioned report (Annex) which forms part of the Hong
Kong Monetary Authority’s (HKMA) ongoing initiative to promote Regtech
adoption in Anti-Money Laundering and Counter-Financing of Terrorism
(AML/CFT) and increase the effectiveness of efforts to combat digital fraud and
financial crime in the banking sector. The report builds on the first volume of the
“AML/CFT Regtech: Case Studies and Insights”, published in January 20211
, and aims to give further impetus to adoption rates, which have increased significantly
since the work commenced in 2019.
This latest report was developed with industry collaboration and in cooperation with
an international consulting firm, sharing comprehensive, end-to-end experience and
success stories from Authorized Institutions (AIs) of different sizes and at different
stages in their AML Regtech adoption journeys. Four broad areas of Regtech
implementation and real-life use cases are featured, including real-time fraud
monitoring, machine learning for transaction monitoring alerts handling, natural
language processing for media monitoring and analytics providing a ‘single view of
the customer’. Based on industry feedback, we have also retained and further
developed in the report the thematic insights targeting areas where AIs have
requested support. Under its “Fintech 2025” strategy, the HKMA remains committed to the promotion
of AML Regtech adoption to tackle the harm caused by digital fraud and other
financial crimes, as well as delivering sustainable and effective AML/CFT systems.
AIs should study the report and have regard to the shared experience and insight to
help staying effective and efficient in the light of evolving risks. The HKMA will
continue to engage AIs individually and collectively on various follow up activities
related to the themes in the report and as part of our ongoing supervisory engagement.
Should you have any questions regarding this circular, please contact us at
Yours faithfully
Carmen Chu
Executive Director (Enforcement and AML) Annex “AML/CFT Regtech: Case Studies and Insights Volume 2’’ (PDF File, 17.5 MB)
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