Moody’s Talks: KYC Decoded

Let's get into the evolving world of fraud on KYC Decoded, where the complexity and sophistication of fraud now poses new and daunting challenges for professionals and organizations alike. This episode draws on invaluable insights from the Cifas Fraudscape report, brought to life by guest, Stephen Dalton, Director of Intelligence at Cifas. Together with our host, Alex Pillow, they analyze the most concerning fraud trends, uncover the advanced tactics of fraudsters, and emphasize the importance of data in defending against threats.  Key topics in this episode include:  The factors leading to the rise in reported fraud cases and strategies to combat this upward trend The sophistication of modern scams and the impact on targeted industries Fraudulent activities committed by lone individuals versus organized crime groups  How AI is leveraged by both fraudsters and compliance professionals  The essential measures to detecting and disrupting fraud  To learn how Moody’s compliance and third-party risk management can help your organization with fraud prevention, please visit our website or get in touch; we’d love to hear from you. 

The positioning of “traditional” KYC against new and emerging methodologies creates opportunities to assess the most effective processes and technologies used to prevent financial crime. It raises the question: What transformative actions and AI implementations are needed to revolutionize a KYC framework, ensuring the industry is prepared for future advancement? In this episode of KYC Decoded, Hanjo Seibert, managing director and partner at Boston Consulting Group, and global lead for Compliance and Anti-Financial Crime (AFC) Technology Transformation joins our host Alex Pillow. Their insightful dialogue provides fresh viewpoints on questions such as: Are traditional KYC/AML methods sufficient to address the challenges professionals face today?How can rules-based and data-driven approaches combine to increase efficiency?How should professionals approach problem-solving: by prioritizing data first or by putting compliance considerations first?How can financial institutions ensure personnel are trained to effectively use new technologies against fraudsters who are also innovating rapidly?Will we continue to see multiple vendors providing diverse solutions, or is there a trend towards consolidating services into one-stop shops?To find out more about the topics discussed in this episode - check out these resources: Watch Hanjo’s Ted Talk: What you can do to stop economic crimeListen to the BCG on Compliance podcast: Apple, Spotify, AmazonRead Moody’s blog post: 8 best financial crime booksAnd if you would like to see how Moody’s compliance and third-party risk management can help with your approach to KYC, please visit our website or get in touch; we’d love to hear from you. 

Disclaimer: Please note in the introduction to this episode it is mentioned that Russia further invaded Ukraine in 2020 rather than the correct year of 2022.In this episode of KYC Decoded, we dive into Article 5r which mandates European banks report any money transfers exceeding 100,000 euros leaving the EU, targeting entities with more than 40% Russian ownership. Join Moody’s Industry Practice Lead, Nicola Passariello, and host Alex Pillow as they unravel the complexities of financial surveillance under Article 5r of EU Reg. 833. Learn more about the implications this directive has for the financial sector and navigating complex ownership structures to meet new deadlines.  Highlights include: An introduction and explanation of Article 5r of EU Reg. 833Reporting requirements for financial institutionsChallenges in identifying direct and indirect ownershipImportance of having a full KYC programCommon pitfalls and guidance for practitionersFor additional resources mentioned in this episode, visit: The Banker articleMoody’s article 5r blogFor more information visit our website and get in touch with one of our experts – we'd love to hear from you.

From social media account information to password creation to IP addresses, the digital footprint we create grows larger every time we go online – and it is virtually impossible to avoid.  At the same time, sophisticated criminals can capture this wealth of Personally Identifiable Information (PII) and create synthetic identities to commit crimes like fraud, money laundering, illegal weapons dealing, and more.Although scary, the first thing we can do to combat this criminal behavior is learn about it. So, we are excited to share the mic with Constella's experts, Jason Wagner, Vice President of Identity & Digital Intelligence, and Dan Mathews, Director of Worldwide Sales Engineering.You do not want to miss this incredibly engaging and knowledgeable conversation with host, Alex Pillow, asking hard-hitting questions like:What is a synthetic identity?What threats do synthetic identities pose to the financial sector at large?How are criminals stealing data?What populations and kinds of businesses are most vulnerable to the risks associated with synthetic identities?What are “ghosts” in the context of synthetic identities, and how can they attack businesses?How is AI changing the landscape of creating synthetic identities?How can the risks created by synthetic identity fraud be mitigated?To learn more about topics discussed on this episode, check out the resources mentioned below:Constella blogConstella Intelligence LinkedIn accountConstella's 2024 Identity Breach ReportIf you want to be at the forefront of combatting financial crime in your organization, visit our website to see how we can help, and feel free to get in touch – we would love to hear from you.

In this episode, KYC Decoded welcomes Derek Vadala, Chief Risk Officer at BitSight, who shares his insights on the intricacies of cyber risk, technology risk, and digital risk with host Alex Pillow. They explore the evolving nature of cyber threats, from financially motivated attacks to nation-state espionage, and discuss best practices for mitigating these risks through in depth defense strategies and ongoing monitoring. Derek emphasizes the criticality of a risk-based approach to supply chain due diligence and the importance of integrating cyber risk management into broader compliance frameworks.Key takeaways:Cyber risk encompasses adversarial activities, technology issues, and digital transformation challenges, each requiring distinct mitigation strategiesFinancially motivated cyber criminals and nation-state actors use different tactics but can blur lines, necessitating vigilant, multifaceted defensesEffective cyber defense relies on automation and layered security measures, beyond just user educationIntegrating cyber risk management with overall compliance and due diligence processes enhances organizational resilienceTo learn more about cyber related risk, please check out the resources below:Risky business podcastCyber Security Headlines podcastTo learn how you can mitigate cyber-related risk in your organization, visit our website  and feel free to get in touch - we would love to hear from you.

This episode introduces the Data and Technology for Compliance (DT4C) Alliance, an industry group comprising leading data and technology companies focused on enhancing financial crime prevention in the EU. Host Alex Pillow, along with Ted Datta from Moody's, and Gem Conn from Dow Jones Risk and Compliance, discuss the Alliance's goals, key initiatives, and the impact they have had so far, including the inclusion of high-quality data standards in AML regulations.They explore how the alliance works in practice, the balance between data privacy and AML effectiveness, and the broader implications for risk and compliance professionals. For more information or to get involved, listeners are encouraged to visit the DT4C website www.dt4calliance.eu, email the secretariat@dt4calliance.eu or reach out to the contributors on LinkedIn.

As digital assets continue to evolve and enrich investment portfolios, they simultaneously demand innovative anti-money laundering (AML) and compliance strategies to counteract potential exploitation by bad actors. There is a critical need for financial service firms to adapt to these changes, understanding the money laundering risks tied to crypto.  In this episode of KYC Decoded, we are joined by Liat Shetret, Director of Global Policy and Regulation at Elliptic, and Karmjeet Singh, Product Strategist at Moody’s, who together unravel the pivotal role of Virtual Asset Service Providers (VASP) in navigating and addressing these emerging challenges in the digital economy. Key topics of their conversation include: The rapid evolution and developments of the VASP and cryptocurrency ecosystem in recent years The sophistication and complexities of criminal activity in the digital world Strategies to effectively manage the challenges posed by VASP How compliance officers balance dual roles of safeguarding against risk while facilitating organizational growth Predictions on future crypto market trends and their implications for risk and compliance professionals For additional resources: Read Elliptic’s blogSign up for Elliptic’s newsletterListen to KYC Decoded’s Crypto Miniseries: Part 1, Part 2, Part 3To learn more about our VASP screening for your organization, please feel free to reach out – we would love to hear from you! 

Some of the most crucial actors in the world of regulatory compliance exist within the public sector. But, with so many private sector players gathering data and making risk-based decisions, how can the two groups bridge any divides to overcome increasingly sophisticated criminals?In this episode of KYC Decoded, host Alex Pillow is joined by public sector colleagues Linda Hamilton, Deputy Director of Organised Crime in Fraud Investigations Service at the HM Revenue & Customs (HMRC), and Kevin Newe, Illicit Finances Threat Lead from HMRC. Their engaging conversation provides unique perspectives on questions like:Why is there a need to invest more in preventing economic crime and money laundering?How can we strike a balance between a public-private sector feedback loop and preserving confidentiality?What do good public-private partnerships look like and are there opportunities for improvement?When combatting financial crime, where should the public sector take the lead and where the private sector?How should data and technology vendors be involved with their private sector partners and the public sector?What makes a good SAR and what can be said about software that automates writing them?To learn more about what was discussed in this episode, be sure to check out these additional resources:UK Financial Intelligence UnitFinancial Action Task Force risk trends and methodologiesFATF Annual Report 2020-2021National Economic Crime CentreAnd, if you’d like to see how Moody’s Compliance and third-party risk management can help you with AML, please visit our website or get in touch; we’d love to hear from you.

As regulatory stakes grow higher, so does the need for reliable, comprehensive data when evaluating risk. Enter: the Moody’s Entity Verification API. In a single source, this powerful tool layers curated data on over 525 million global companies along with real-time entity information from primary sources. Here to share more on the making of this tool and its value in a compliance program are Johanna Konrad, Moody’s Compliance & third-party risk Managing Director of Product Management, and Jon Hanmer, Moody’s Sales Senior Director. Joining host, Alex Pillow, they discussed:How direct customer feedback shaped what the Entity Verification API deliversHow the solution benefits stakeholders in different sectorsWhy strong entity verification lays the groundwork for a “golden record,” and why that mattersEnablement of practitioners to monitor entities in a perpetual KYC (pKYC) programFor more information about the Moody’s Entity Verification API, visit our website. If you’d like to book a demo or learn more, please get in touch; we would love to hear from you!

The term “Entity Verification” can mean different things to different people. Perhaps it brings to mind beneficial ownership, identity checks, or third-party risk management. Regardless, Entity Verification is the bedrock for understanding who you are doing business with.We are pleased to welcome back guest, Paul Nola, Partner at Context Consulting, for this episode of Moody’s Talks: KYC Decoded. Paul walks us through the findings of Moody’s latest study on Entity Verification. In addition to sharing how the study was conducted and some of the results of the report, Paul and host, Alex Pillow, discuss common themes that emerged, such as:Why the time is now to be ramping up Entity Verification programsChallenges that can make Entity Verification difficult to implementThe downstream benefits of a strong Entity Verification foundationThe need for proper and robust data governanceHow AI is being used to make Entity Verification scale in a quick, reliable wayThe elusive ‘golden record’ - a single view of a data entityYou can find more information about Entity Verification on our website, or check out the resource below: Who are you doing business with? A Moody’s study into Entity VerificationIf you would like to learn more about Moody’s Entity Verification data offerings, please get in touch – we would love to hear from you.