Imogen Cronin
Valentina Pegolo
Orel Garcia
Plenitude Insights
Fraud
RegSightThis paper explores the key amendments and implementations across four global financial hubs: the United Kingdom, European Union, Hong Kong and Singapore. These jurisdictions have been at the forefront of regulatory innovation, and will continue to lead development during 2024.
In this report, the team highlights legislative, regulatory, and industry developments occurring across the realms of anti-money laundering (AML), counter-terrorist financing (CTF), counter-proliferation financing (CPF), fraud, and sanctions, as well as notable enforcement and disciplinary actions from regulators. With the number, complexity, and speed of regulatory changes increasing from year to year, remaining up-to-date with new regulatory obligations is a necessity for financial crime compliance teams.
Several external factors shaped the regulatory developments in 2023. The team highlights how global geopolitical changes have shaped governments’ sanction and CTF/CPF regimes, the on-going push to regulate virtual assets, and how money laundering scandals have gained notoriety in Singapore and Hong Kong, resulting in renewed efforts to strengthen AML controls.
Conclusion
In the UK, firms should prepare for continuing regulatory developments across the realms of fraud, virtual assets regulation, and sanctions. Several developments approved in 2023 are scheduled for implementation in 2024, including the full roll-out of the Consumer Duty in July and the mandatory reimbursement on APP fraud in October. In the coming year, firms should also expect greater clarity on the implementation timeline for the long-awaited Companies House reform and HMT cryptoasset regulatory regime, and should await the scheduled review of Senior Managers and Certification Regime between April and June.
Throughout 2023, the EU positioned itself at the forefront of global initiatives to regulate new technologies and cryptoassets. In 2024, firms can expect to see the implementation of the Markets in Crypto-Assets Regulation (MiCA), including MiCA’s new regime on E-Money Tokens and Asset-Referenced Tokens in June, MiCA’s new CASPs requirements in December, and the implementation of the Transfer of Funds Regulation (TFR) in December. In parallel, the EU demonstrated a commitment to strengthening its existing AML/CTF/CPF regime and maintained its central role in facilitating international collaboration to foster the successful implementation and enforcement of economic sanctions. Much like in the UK, firms should expect to see new sanctions packages and more stringent anti-circumvention regimes in the coming year. Firms can also await further information on the planned establishment of a new EU Anti-Money Laundering Authority (AMLA), which is expected to push the EU towards greater cross-country coordination in AML compliance.
High-profile money laundering and fraud scandals in Hong Kong and Singapore directed regulators’ focus to implementing strengthened AML policies, promoting technology and information sharing in fraud prevention, and accelerating discussions on the future of virtual assets regulation. Following the implementation of Hong Kong’s VASPs licensing requirements, ‘Travel Rule’, and AML requirement for VASPs in 2023, firms can anticipate continued discourse and additional details concerning the implementation of Singapore’s Stablecoins regulation in the upcoming year. In the midst of Singapore’s $2.8 billion money laundering scandal, authorities have issued new AML guidelines for the wealth management sector, on the use of complex structures, and for AML controls concerning virtual assets. Firms should stay attuned to the further strengthening of AML requirements, as well as a renewed emphasis on combating fraud from regulators.
