FinCEN Trims CTA with Interim Rule

On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule that significantly alters the reporting requirements under the Corporate Transparency Act (CTA). This rule exempts U.S.-based entities, previously classified as “domestic reporting companies,” from the obligation to report beneficial ownership information (BOI) to FinCEN. Consequently, these domestic entities are no longer required to submit, update, or correct BOI reports. The focus now shifts to “foreign reporting companies,” defined as entities formed under foreign laws but registered to do business in the United States. These foreign entities are still required to report BOI, but the rule extends their filing deadline by 30 days from the rule’s publication date— to April 20, providing additional time for compliance. Notably, foreign reporting companies are exempted from reporting BOI of any U.S. persons who are beneficial owners, and U.S. persons are not required to provide such information to these foreign entities.

This interim rule comes after a period of legal uncertainty surrounding the CTA’s implementation. Previously, court orders had halted BOI reporting requirements between December 3, 2024, and February 18, 2025. With the issuance of this rule, FinCEN has clarified the current obligations, emphasizing that domestic entities are exempt from reporting, while foreign entities must comply within the specified timeframe. FinCEN is accepting public comments on this interim rule and intends to issue a final rule later this year. Entities affected by these changes should review the interim rule in detail and consider submitting comments to FinCEN during the open period.

Vanquis Banking Group Enhances AML Oversight with FinScan

Vanquis Banking Group has selected FinScan to optimize its anti-money laundering (AML) processes, reinforcing its financial crime risk management framework. The decision reflects a broader industry shift toward technology-driven compliance strategies that improve operational efficiency and regulatory adherence.

As a specialist UK bank, Vanquis faces increasing scrutiny over financial crime prevention, making the integration of advanced screening technology a strategic move. FinScan’s centralized platform enables real-time and retrospective name screening, enhancing customer due diligence and risk assessment. Its configurable matching technology supports more precise identification of potential risks, ensuring a more responsive compliance function.

Paul Blackmore, Head of Financial Crime at Vanquis Banking Group, emphasized the role of technology in meeting compliance and business objectives: “At Vanquis, compliance and operational efficiency are core to our commitment to responsible lending. Partnering with FinScan allows us to harness advanced technology that aligns with our business goals. Its scalability, configurability, and centralized capabilities make it the ideal solution to optimize our AML processes and support our growth.”

The partnership comes amid growing regulatory expectations for financial institutions to enhance their AML capabilities. FinScan’s ability to integrate diverse data sources and provide a risk-based approach positions it as a valuable tool for banks seeking greater transparency and efficiency in their compliance operations.

Steve Maul, Chief Revenue Officer of Innovative Systems, Inc., noted the tailored nature of FinScan’s capabilities: “Unlike off-the-shelf solutions, FinScan offers tailored AML compliance capabilities designed to meet the bank’s specific needs, including simplifying simulation matching for KYC onboarding and monitoring.”

This collaboration underscores the importance of adaptable compliance technology in today’s financial landscape, where regulatory requirements continue to evolve, and banks must balance risk management with operational efficiency.

STP LaunchAdvisor Combines Fund Admin and Compliance for New and Emerging Funds

STP Investment Services has released STP LaunchAdvisor, a bundled service aimed at helping emerging hedge fund and private equity managers navigate operational and regulatory complexities. The solution integrates fund administration and compliance into a single offering, reducing the need for multiple service providers and streamlining essential processes.

STP LaunchAdvisor is designed to create efficiencies by leveraging client and portfolio data across fund administration and compliance functions. For example, regulatory filings prepared by STP’s ComplianceAdvisor team utilize the same data used in fund administration, reducing duplication and improving accuracy. The service also includes access to STP’s BluePrint platform, which centralizes investment operations, reporting, and analytics.

In addition to operational support, STP LaunchAdvisor provides hands-on guidance for new managers, helping them understand service requirements, provider coordination, and long-term business setup. The offering connects managers with a network of preferred providers, including audit, tax, prime brokerage, and legal firms, to facilitate essential services at competitive rates.

“With market conditions in 2025 expected to drive increased fund launch activity, new managers need cost-effective, comprehensive solutions to support their operational and regulatory needs,” said David Goldstein, Director of Fund Administration Product at STP Investment Services. “STP LaunchAdvisor is designed to remove complexity, reduce costs and time to market, ensure compliance, and streamline regulatory filings. We provide hands-on expertise, ensuring that managers have the tools and guidance they need from day one.”

STP emphasizes the importance of early-stage support, particularly for managers entering the market for the first time. “STP LaunchAdvisor is more than just a service – STP’s service team builds true partnerships with new managers who need more support in the early stages,” said Emmy Bernard, Chief Revenue Officer at STP Investment Services. “Our solution not only supports new managers but ensures they can adapt and thrive in an ever-changing market, with technology, compliance, and operational efficiency built in to keep them ahead of the curve.”

By integrating fund administration and compliance functions, STP aims to provide emerging managers with the infrastructure needed to scale efficiently while maintaining regulatory oversight. The approach aligns with broader industry trends favoring streamlined operations and cost efficiency in fund management.

Oracle Adds Agentic AI to Investigation Hub for Financial Crime

Oracle Financial Services has added a broad set of agentic AI capabilities to its Investigation Hub Cloud Service, aimed at helping financial institutions automate parts of their investigative workflow and reduce manual effort when tackling financial crime.

The new AI agents are designed to assist investigators by gathering evidence, surfacing key insights, and generating detailed case narratives—tasks that often require significant time and effort. By handling these elements automatically, the system allows investigators to focus on the more complex aspects of cases, particularly those involving sophisticated criminal schemes.

Jason Somrak, head of financial crime product strategy at Oracle Financial Services, described the development as a “paradigm shift in financial crime investigations,” noting that Oracle’s approach allows AI agents to “follow investigative plans, collect evidence, and recommend actions while providing investigators with robust narratives documenting the findings.” According to Somrak, this process “enables firms to drive consistency in decision making and thoroughly investigate all risks automatically.”

The move reflects growing demands on financial institutions to detect and respond to increasingly complex financial crime threats, all while navigating heightened regulatory expectations. Traditional investigation methods—often reliant on manual data collection and analysis—can be slow and inconsistent, exposing firms to risks from bad actors and regulatory risks of non-compliance.

Unlike AI chatbots that depend on investigators asking specific questions, Oracle’s AI agents are built to proactively analyse alert data, identify connections (such as matches with sanction lists), and generate comprehensive narratives that summarize each case. The goal is to provide investigators with clear, relevant information to support more informed and timely decisions.

These AI-driven features form part of Oracle’s broader suite of financial crime and compliance tools, which are increasingly leveraging generative AI to improve the speed, consistency, and reliability of financial investigations.

Euroclear and Microsoft Partner to Enhance Capital Markets Infrastructure

Euroclear has entered a seven-year partnership with Microsoft to modernize its technology infrastructure and develop new digital and data-driven capabilities for financial market participants. The collaboration will focus on leveraging cloud computing, artificial intelligence (AI), and advanced analytics to enhance Euroclear’s role as a key financial market infrastructure provider.

The initiative is designed to foster greater efficiency in capital markets by shifting towards an ecosystem-driven model. Microsoft’s cloud solutions, including Azure and AI-powered tools, will support Euroclear in developing a more flexible and scalable platform for data sharing, customer engagement, and market infrastructure resilience.

A Shift Toward Data-Enabled Market Infrastructure

The collaboration aims to enhance Euroclear’s ability to process and share financial data securely while strengthening operational resilience. The initial phase of the partnership will focus on:

• Financial data sharing: Developing a secure platform to enable controlled data collaboration across financial institutions.
• Enhancements to Euroclear FundsPlace®: Improving the client experience with AI-driven insights and more efficient fund processing.
• Customer engagement modernization: Establishing a unified platform for streamlined interactions across Euroclear’s business lines.
• Strengthening market infrastructure: Building a more resilient financial infrastructure with integrated security and compliance features.

“Technology is rapidly transforming financial market infrastructures,” said Valérie Urbain, CEO of Euroclear. “Harnessing the latest developments in cloud, AI, and analytics is a critical enabler of Euroclear’s strategy and a driver of innovation and new business without compromising resilience. Microsoft’s technology leadership and understanding of financial markets make it an ideal strategic partner for the next stage in our journey. This mutually beneficial relationship greatly accelerates our ambitions and should bring us much closer to clients.”

Microsoft will provide cloud-based scalability and automation tools to support Euroclear’s operational resilience, including disaster recovery and business continuity solutions. “Our partnership with Euroclear combines their extensive financial ecosystem—connecting more than 2,000 financial institutions—with the trust and scalability of the Microsoft Cloud including Microsoft Azure, Microsoft Copilot, Azure AI, Microsoft Fabric and Microsoft Teams,” said Ralph Haupter, President, EMEA at Microsoft. “Together, we are enabling a shift from traditional sequential workflows to an ecosystem-centric capital markets model. This transformation will empower financial institutions to reimagine how they interact, analyse data and deliver insights to end users, driving efficiency and innovation across the industry.”

The partnership is guided by senior executives from both companies, ensuring alignment between technology and business objectives. As the collaboration evolves, new digital and data initiatives will be explored to further enhance market efficiency and financial services innovation.

Sumsub Releases AI-Powered AML Screening Enhancements

Full-cycle verification vendor Sumsub, recently released new AI-driven enhancements to its AML screening and case management capabilities, aiming to help compliance teams reduce manual workload and improve the accuracy of risk detection. The updates address a critical challenge in financial crime compliance—the growing volume of false positives that consume valuable time and resources.

Regulatory bodies worldwide continue to tighten anti-money laundering (AML) requirements, pushing firms to adopt more automated, intelligent solutions. Traditional screening methods often generate excessive alerts, leading to inefficiencies in case resolution. Sumsub’s AI-driven approach seeks to mitigate this by filtering out low-risk alerts, allowing compliance teams to focus on high-priority cases without compromising accuracy.

“Compliance teams face immense pressure to detect financial crime while managing an overwhelming number of alerts. Traditional AML screening can be like searching for a needle in a haystack – compliance teams spend countless hours sifting through false positives to find real risks. Our AI acts like a powerful magnet, helping to filter out irrelevant alerts and strengthen our solution,” explains Vyacheslav Zholudev, co-founder and CTO of Sumsub.

The enhanced AML screening solution introduces several key capabilities:

• AI-Driven Alert Prioritization: Advanced machine learning algorithms analyse patterns and past decisions to differentiate between genuine risks and false positives, minimizing unnecessary manual review.
• Centralized Case Management: A unified platform streamlines investigation workflows, facilitating task assignments, collaboration, and real-time updates.
• Automated SAR/STR Reporting: Compliance teams can generate Suspicious Activity Reports (SARs) or Suspicious Transaction Reports (STRs) with minimal manual input, ensuring regulatory compliance.
• Real-Time Transaction Monitoring: A comprehensive dashboard provides insights into transactions, helping teams track potential fraud patterns and make data-driven decisions.
• Improved Team Collaboration: Integrated tools allow for efficient case tracking, notes, and communication among compliance officers, ensuring a more streamlined approach to financial crime prevention.

As firms grapple with evolving regulatory requirements and increasingly sophisticated financial crime typologies, AI-powered compliance solutions are becoming essential. Sumsub’s latest enhancements reflect a broader industry shift toward automation and data-driven decision-making, equipping compliance teams with tools to operate more efficiently in a fast-changing regulatory landscape.

Fenergo and PwC Partner to Enhance Financial Crime Compliance and Efficiency

A new collaboration between Fenergo and PwC aims to help financial institutions streamline financial crime compliance, improve operational efficiency, and navigate evolving regulatory demands. By combining PwC’s expertise in financial crime and regulatory compliance with Fenergo’s AI-driven client lifecycle management (CLM) and Know Your Customer (KYC) technology, the partnership is set to accelerate digital transformation in the sector. 

Financial institutions face increasing pressure to enhance financial crime risk management while maintaining efficiency. The partnership integrates Fenergo’s AI-powered CLM solutions with PwC’s advisory and implementation capabilities, supporting firms in scaling their compliance operations and optimizing processes. 

Mark Hunter, Partner at PwC, highlighted the importance of the collaboration: “Fenergo’s AI-powered platform is uniquely positioned to serve mid-market to large multinational organizations, offering the scale, flexibility, and advanced capabilities needed to manage complex regulatory environments and high volumes of transactions across global operations. This collaboration is enabling us to deliver even greater value and sustained outcomes to our clients. Clients choose PwC to drive growth, transform and create value – and that includes interventions with technology. Our approach focuses on how Fenergo’s software can add value to our clients’ organisations holistically. Our teams across our global practice have experience implementing Fenergo solutions at scale, and across multiple jurisdictions. We’ve invested in our own multi-disciplinary teams, who are now Fenergo-certified and have specialist functional capabilities and technical expertise to configure the Fenergo platform.” 

PwC’s role extends beyond implementation, with services such as target operating model design, customer experience mapping, and business change management. By leveraging PwC’s expertise, financial institutions can achieve a smoother integration of Fenergo’s technology into their existing frameworks. 

Matt Edwards, Global VP Partnerships and Alliances at Fenergo, emphasized the strategic advantage: “The synergy between Fenergo and PwC creates a powerful value proposition for financial institutions seeking to streamline financial crime operations and increase efficiencies in the face of accelerated regulatory change. The collaboration enables Fenergo to tap into PwC’s industry leading consultancy and implementation services to deliver an optimum target operating model for CLM. The result is a premium solution which empowers financial institutions to efficiently mitigate financial crime risk while driving growth and efficiency gains.” 

With financial institutions under growing scrutiny to enhance compliance while maintaining a seamless client experience, this partnership provides a structured approach to modernizing financial crime operations. The collaboration underscores a broader industry shift towards integrating advanced technology with deep regulatory expertise to drive sustainable compliance solutions. 

New Cyber and Emerging Technologies Unit at SEC

The Securities and Exchange Commission (SEC) has established the Cyber and Emerging Technologies Unit (CETU) to address cyber-related misconduct and safeguard retail investors in the evolving tech landscape. This new unit, led by Laura D’Allaird, succeeds the former Crypto Assets and Cyber Unit and comprises around 30 fraud specialists and attorneys from various SEC offices. 

Acting Chairman Mark T. Uyeda emphasized that CETU’s formation aims to protect investors while promoting innovation. He noted that the unit will “root out those seeking to misuse innovation to harm investors and diminish confidence in new technologies.” 

CETU’s priorities include addressing fraud involving emerging technologies like artificial intelligence and machine learning, misuse of social media and the dark web for fraudulent activities, unauthorized acquisition of non-public information through hacking, takeovers of retail brokerage accounts, fraud related to blockchain and crypto assets, ensuring regulated entities comply with cybersecurity regulations, and monitoring public companies’ disclosures concerning cybersecurity. 

This initiative reflects the SEC’s commitment to adapting its enforcement strategies to the rapidly changing technological environment, aiming to foster a secure and transparent market for investors and innovators alike. 

UK Penalties for AML Regulatory Breaches More Than Double 2023 – Fenergo Research

According to a new analysis by Client Lifecycle Management and perpetual KYC solution provider Fenergo, financial institutions in the UK have experienced a sharp increase in the total value of AML-related fines despite a drop in the number of enforcement actions.

In 2024, the Financial Conduct Authority (FCA) issued three significant fines totalling $64.74 million, up from $25.2 million in 2023. While the overall number of AML penalties from the FCA has declined by 80% since 2022, the total value of fines has risen notably. Notable cases include Metro Bank ($21.8 million) and Starling Bank ($38.4 million), with an additional $4.5 million fine against CB Payments, part of the Coinbase Group, for weaknesses in financial crime control frameworks.

Fenergo’s data highlights mixed trends on a global scale. Although the total value of AML-related penalties worldwide dropped by 30% to $4.6 billion (from $6.5 billion in 2023), banks faced a 522% increase in fines, amounting to $3.65 billion. Penalties specifically tied to transaction monitoring breaches surged by 100% year-over-year to $3.3 billion.

Beyond AML, Fenergo’s research also points to growing enforcement actions related to environmental, social, and governance (ESG) practices. Global ESG-related fines nearly doubled, reaching $37.7 million in 2024, while in the United States, these fines rose by 13%, totalling $21.5 million.

Reflecting on these developments, Rory Doyle, Director of Regulatory Affairs at Fenergo, notes, “The surge in penalties for AML violations in banking in the UK and around the world underscores the relentless pace at which financial crime evolves, and the growing expectations placed on financial institutions by regulators. While progress is being made, the data serves as a clear reminder that compliance must continually adapt to meet new challenges.”

Key findings from 2024 global regulatory fines include:

• Banks accounted for 80% of all fines, totalling $3.65 billion. TD Bank became the largest U.S. institution to plead guilty to Bank Secrecy Act (BSA) violations.
• Digital asset platforms were fined $762.9 million.
• Payments firms faced $54.8 million in penalties.
• Buy-side firms received $52.85 million in fines.
• Private banks were fined $48.2 million.

Doyle emphasizes the importance of proactive measures and technology adoption: : “In today’s environment, staying ahead isn’t just about monetary loss and avoiding fines — it’s about building trust, safeguarding stakeholders and maintaining operational resilience. As the financial landscape becomes increasingly complex, leveraging advanced technologies and fostering a culture of proactive compliance will be key to addressing regulatory demands and mitigating risk. This is particularly evident in the UK, where politically exposed person (PEP) risk assessments have grown increasingly complex compared to those in other jurisdictions.”

SEC Launches Crypto Task Force to Provide Clarity on Regulatory Framework

Acting U.S. Securities and Exchange Commission (SEC) Chairman Mark T. Uyeda has launched a new crypto task force aimed at establishing a comprehensive and transparent regulatory framework for digital assets. Commissioner Hester Peirce will lead the initiative, with Richard Gabbert, Senior Advisor to the Acting Chairman serving as the task force Chief of Staff, and Taylor Asher, Senior Policy Advisor to the Acting Chairman, assuming the role of Chief Policy Advisor.

The task force will work across SEC divisions and engage with stakeholders to define clear regulatory parameters for crypto assets. Historically, the SEC’s approach to crypto regulation has been largely enforcement-driven, often leading to uncertainty for industry participants. The initiative seeks to address challenges related to compliance, registration, and disclosure by offering practical solutions and clearer guidelines.

“I look forward to the efforts of Commissioner Peirce to lead regulatory policy on crypto, which involves multiple SEC divisions and offices,” said Acting Chairman Uyeda.

Commissioner Peirce emphasized the importance of broad stakeholder engagement, stating, “This undertaking will take time, patience, and much hard work. It will succeed only if the Task Force has input from a wide range of investors, industry participants, academics, and other interested parties. We look forward to working hand-in-hand with the public to foster a regulatory environment that protects investors, facilitates capital formation, fosters market integrity, and supports innovation.”

In addition to developing regulatory clarity, the task force will collaborate with other federal and international regulatory bodies, such as the Commodity Futures Trading Commission (CFTC), to ensure a coordinated approach. The initiative will also provide technical assistance to Congress as it considers updates to existing legislation.

Public engagement will be a cornerstone of the task force’s efforts, with future roundtables planned to facilitate dialogue. In the interim, stakeholders are encouraged to share their insights via Crypto@sec.gov.