Cohort #1 of Central Bank of Ireland’s Innovation Sandbox Programme: ‘Combatting Financial Crime’

Seven participants of the Central Bank of Ireland’s Innovation Sandbox Programme on ‘Combatting Financial Crime’ are:


1) AMLYZE is building an AML/CFT information-sharing framework that will use structured taxonomies and synthetic data to simplify detecting and preventing fraudulent activities.
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2) Expleo Group has developed an anti-SMS fraud solution which installs on mobile phones to combat SMS fraud.

3) Forward Emphasis and Pasabi’s joint innovation will develop and test a Motor Insurance Application Fraud Analytics solution, leveraging AI-driven behavioural analytics, machine learning, and pattern recognition to detect fraud in the pre-sales process.

4) Roseman Labs enables secure, GDPR-compliant collaboration and analysis on sensitive data for regulated industries.

5) Sedicii (hello Rob Leslie) and PTSB Sedicii has partnered with PTSB to create a secure and private collaboration using zero knowledge proofs to verify names and addresses, in real-time, as part of their customer KYC process, using ESB Networks as the authority for address data in Ireland in full compliance with GDPR and which involves no sharing of personal data.

6) TrustElevate.com offers a privacy-preserving solution for verifying parental responsibility and child age.

7) Vidos.Id is developing digital identity verification solutions to help financial institutions verify digital identity documents and wallet-based credentials.

There are many familiar names here and a couple we hadn't encountered at www.moneylaundering.ie and www.fintechireland.com. Since this all very serious hashtag#regtech, we better dust off the www.regtechireland.com website!

All the best to the cohort.

First posted here

Combatting Financial Crime Theme

The theme of the Innovation Sandbox Programme is:
“Combatting Financial Crime – Through the use of innovative technology, foster and develop innovative solutions that minimise fraud, enhance KYC/AML/CFT frameworks, and improve day-to-day transaction security for consumers.”

The programme will encourage collaboration across the ecosystem to support the fight against financial crime. Programme outputs will include inter alia the documentation and sharing of learnings in fraud prevention and detection. The programme also aims to facilitate the development of new ventures and new business models that solve challenges identified in this sandbox theme and facilitate the faster and safer deployment of substantially new technologies, products, or services.

The Sandbox Programme framework comprises:

• A structured programme of workshops
  Each month participants will engage in workshops on specific topics relevant to the theme of Combatting Financial Crime. The topics will be relevant to participants and tailored to their needs and requirements as much as possible.
  
  
• Ongoing bespoke engagement with dedicated Sandbox Relationship Managers
  Each participant will engage regularly with their dedicated Sandbox Relationship Manager, who will act as their point of contact to oversee and coordinate participation throughout the programme. The Sandbox Relationship Manager will also liaise with a broad range of Central Bank teams – from across the pillars of Consumer and Investor Protection, Financial Regulation, and Monetary and Financial Stability – to provide regulatory advice and support as required.
  
  
• Access to Data Platform
  Each participant can avail of access to a Data Platform offering data sets and tools relevant to the theme of Combatting Financial Crime. This will allow participants to test and develop their innovation.

The methodology and delivery of this programme will be subject to continual assessment and impact review.

What is the Challenge?

• Trust is one of the fundamental cornerstones of a well-functioning, resilient financial system. Financial crime erodes this trust for those who rely on its integrity.
  
  
• The fight against financial crime diverts resources away from economically and socially productive uses, and can undermine a country's financial stability.
  
  
• The pace of innovation and new technologies has meant companies are vulnerable to criminals as they introduce innovations.
  
  
• Globally, scams drove over $1 trillion in financial losses in 2023, while losses from Authorised Push Payment scams was valued at €9.9 million in Ireland in 2022, according to FraudSmart.
  
  
• Financial crime is not just an issue for the financial sector, but for other sectors too. One of the key factors in successfully reducing financial crime is for firms and wider partners to work collaboratively by sharing data and intelligence.

​What are the Problem Statements?

1. Overall: What technological solutions can help to deliver positive outcomes for consumers and firms by supporting them in combatting financial crime and fraud?
   
   
2. Collaboration: Can collaboration and information-sharing between and within the financial system, technology providers and other stakeholders enhance the effectiveness of anti-money laundering and counter terrorism financing efforts?
   
   
3. Firm obligations: How can innovative technology, including AI, be deployed to support firms to effectively meet their regulatory obligations?
   
   
4. Patterns: How can technology be better deployed to detect patterns or other indicators of consumer behaviour that may indicate financial crime is taking place?
   
   
5. Consumer protection: How can efforts to combat financial crime ensure that the solutions do not comprise privacy, data, security or consumer protection?
   
   
6. Regulatory adaptability: What are the impacts of the changing trends and emerging technologies in financial crime on the regulatory frameworks? To what extent do the current regulatory frameworks enable or hinder the use of technology to combat financial crime?

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