Turbotodd

Ruminations on tech, the digital media, and some golf thrown in for good measure.

Archive for the ‘regulatory compliance’ Category

You Can e-Pay Me Tuesday…

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Happy Monday.

Some e-pay and cryptocurrency news on today’s agenda.

First, TechCrunch is reporting that it is consolidating its different payment platforms under the Google Pay brand.

This inclues Android Pay (Google’s mobile payments and loyalty platform) and Google Wallet (it’s peer-to-peer payments app), and suggest that “this should make buying and paying through Google less confusing.”

“With Google Pay, it’ll be easier for you to use the payment information saved to your Google Account, so you can speed through checkout with peace of mind,” Bhat wrote. “Over the coming weeks, you’ll see Google Pay online, in store, and across Google products, as well as when you’re paying friends.”
– via TechCrunch

Meanwhile, they’re also reporting that encrypted messaging startup Telegram has plans to launch its own blockchain platform and native cryptocurrency (how many does that make across the industry, again??)

The launch will be funded with an enormous Initial Coin Offering, with forthcoming private pre-sales ranging into the hundreds of millions, potentially making it one of the largest ICOs to date. Demand is driven by the fact that rather than the ICO coming from a fresh startup, Telegram is a well-established messaging platform used around the world. Adopting a homegrown cryptocurrency could give Telegram’s payment system enormous independence from any government or bank — something Co-founder and CEO Pavel Durov is known to covet after investors took over his last company, Russian social network VK. Durov has not responded to TechCrunch’s several attempts to contact him regarding this story.
– via TechCrunch

TechCrunch further explains:

With cryptocurrency powered payments inside Telegram, users could bypass remittance fees when sending funds across international borders, move sums of money privately thanks to the app’s encryption, deliver micropayments that would incur too high of credit card fees, and more.
– via TechCrunch

But be forewarned, Investopedia is reporting that the market capitalization for cryptocurrencies crashed by more than $100 billion in 24 hours as authorities in South Korea, one of the largest markets for trading, announced that they were inspecting six of the country’s largest financial institutions for compliance with anti-money laundering laws.

One would expect a continued see-sawing of the pricing and adoption of cryptocurrencies as governments and regulators around the globe look to reconcile the opportunity crypocurrencies (and related technologies) present with the need to bring some order to this digital wild west.

Written by turbotodd

January 8, 2018 at 11:34 am

New Year, New Regs

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Happy New Year!

2017, we hardly knew ye.

2018, what will ye bring?

So far, in Iran, it’s bringing people into the streets, as tens of thousands of disgruntled Iranians have demonstrated across teh country against the Islamic Republic’s clerical elite and a weak economy, among other issues.

According to The Independent, in response, Iranian authorities temporarily blocked mobile phone access to Instagram and the messaging app Telegram to “maintain peace.”

Pavel Durov is Telegram’s CEO and confirmed access to the app had been restricted:

He wrote on Twitter: “Iranian authorities are blocking access to Telegram for the majority of Iranians after our public refusal to shut down [one of the main channels] and other peacefully protesting channels.” The company did agree to close one channel on Saturday after Iranian authorities claimed people were using it to incite violence.
– via The Independent

According to a report from The New York Times, the protests in Iran have left more than 20 people dead thus far. They are the largest in Iran since 2009, during the “Green” Movement, which took place after the election of the hard-line leader Mahmoud Ahmadinejad.

In other countries, new laws are taking effect that impact Internet and social media access, including in Germany, where a new law that demands social media sites move quickly to remove hate speech, fake news and illegal material.

According to a report from the BBC, the new law gives social networks 24 hours to act after they have been told about law-breaking materials, and that sites that don’t remove “obviously illegal” posts could face fines of up to 50M Euros.

The call to police social media sites more effectively arose after several high-profile cases in which fake news and racist material was being spread via the German arms of prominent social media firms. Germany’s justice ministry said it would make forms available on its site, which concerned citizens could use to report content that violates NetzDG or has not been taken down in time. As well as forcing social media firms to act quickly, NetzDG requires them to put in place a comprehensive complaints structure so that posts can quickly be reported to staff.
– via BBC News

The BBC report goes on to observe that Facebook has reportedly recruited several hundred staff in Germay “to deal with reports about content that breaks the NetzDG and to do a better job of monitoring what people post.”

 

Written by turbotodd

January 2, 2018 at 11:14 am

IBM Launches Cognitive Era of RegTech With New Watson Financial Services

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IBM has launched the first suite of cognitive solutions to help financial institution professionals manage their regulatory and fiduciary responsibilities.

The Watson-powered software, which can be deployed on the IBM Cloud, is designed to help financial professionals in three areas: understanding regulatory requirements, delivering increased insight into potential financial crimes, and managing financial risk with a new architectural approach for data.

Managing risk and compliance currently consumes 10 to 15 percent of operational spending budgets among major banks, with annual spending estimated at $270 billion per year for financial services organizations.

This burden is expected to only grow in the coming years. By 2020, the global financial services industry will contend with an estimated 300 million pages of regulations, with thousands of new pages added each year after that.

Promontory Financial Group
, an IBM subsidiary that specializes in risk management and regulatory compliance, has trained Watson initially on 60,000 regulatory citations.

Watson has also started to review transactions and cases related to potential financial crimes. The result is a suite of cognitive solutions that are designed to offer professionals assistance in making better-informed risk and compliance decisions with greater speed.

Over time, additional data sets will be added, which will allow the machine learning and analytics embedded in Watson Financial Services to further expand and help improve the insights provided to professionals.

Gene Ludwig, founder and chief executive officer of Promontory Financial Group , added, “The speed and volume of information that financial institutions must manage is already daunting and yet still growing rapidly. The answer to this problem is cognitive technology taught by industry experts, like those at Promontory. Essentially, we’re embedding our deep regulatory experience into Watson so that a broader group of professionals can benefit from this knowledge and help their organizations operate more effectively and efficiently.”

The solutions are available to financial services industry clients, many of whom have worked with IBM and Promontory to address their risk and compliance needs.  

The specific products launched by Watson Financial Services today include:

Watson Regulatory Compliance
Watson Regulatory Compliance will help financial institutions better understand and address the constantly changing regulatory requirements. Watson’s natural language processing capabilities are being used to train and understand the language of regulation, and IBM has started the process of feeding regulations from 200 different sources into the system in order to identify and tag potential obligations. This will help simplify the daily, manual activities of compliance professionals by providing a company-specific view of regulatory requirements. 

Compliance professionals using Watson Regulatory Compliance will have access to a customized and searchable library of regulatory requirements, with the ability to identify the obligations and controls applicable to their business, which can be easily filtered by geography, line of business, product, process and compliance area.

They will also be able to more easily track changes, with the ability to subscribe to only the specific parts of the regulation that are directly relevant to them.

IBM Financial Crimes Insight with Watson
Each year, financial institutions spend $18 to $21 billion on anti-money laundering (AML) activities, $16 to $19 billion on know-your-customer (KYC) requirements, and $11 to $15 billion on conduct surveillance. These activities are extremely manual in nature, often requiring significant time to collect information from various sources. The final decision is often subjective and dependent on the experience of individual analysts.

IBM Financial Crimes Insight with Watson applies cognitive computing, intelligent robotic process automation, identity resolution, network analysis, machine learning, and other advanced analytics capabilities to accelerate due diligence activities and help organizations more effectively understand and manage the plethora of AML alerts generated by today’s transaction monitoring systems.

Combined with Promontory’s expertise, financial institutions can increase the speed and accuracy of customer verification and adverse news collection for KYC requirements, help reduce false positives and speed up case investigations for AML alert reviews.

In addition, IBM’s solution for conduct surveillance is being expanded to address broader conduct risks such as sales practices, client suitability and fiduciary responsibilities. This solution goes beyond traditional rules-based and lexicon approaches and generates increased insight by identifying the various activities and behavior associated with misconduct.

It will also advance complaint management in ways that can further assist professionals responsible for identifying misconduct.

IBM Algo One Big Data Foundation
For many financial institutions, it is a challenge to scale their existing systems, and yet, scaling is necessary to meet the dramatic increase in requirements for Fundamental Review of the Trading Book (FRTB) regulations, Valuation Adjustments (XVA) measures, and liquidity analysis.

IBM Algo One Big Data Foundation is a new architectural approach to help clients achieve the performance that is required to address regulatory compliance.

The solution integrates big data technology with the core risk data management applications of Algo One. This enables financial firms to examine risk in a shorter amount of time with an intuitive user interface. By utilizing structured and unstructured data to its fullest potential, the solution is designed to encourage decision makers to ask more complex questions and get better answers faster when developing new business strategies.

This moves the use of big data from an experimental or niche use at a bank to that of daily production to help satisfy banks’ regulatory and financial planning. The first solutions available as part of the new architectural approach focus on liquidity, application lifecycle management, and market risk.

All of the new Watson Financial Services solutions are available today on the IBM Cloud. For more information about IBM Watson Financial Services, visit https://www.ibm.com/watson/financial-services/.

Written by turbotodd

June 14, 2017 at 9:15 am

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