IA Fintech Member Insights: Clausematch 

Good morning!

I hope you enjoyed the first weekend of August!

August is about holidays, relaxation and out-of-office activities, however, there has been some very interesting headlines in the field of financial regulation and RegTech.

In this week’s digest, you’ll find news in relation to the Financial Conduct Authority’s stance on Bitcoin and cryptocurrencies as well as an update on the Bank of England’s and the Prudential Regulation Authority’s Resolvability Assessment Framework.

There’s also an article that looks at how US regulators have recently commenced oversight of cloud providers, while I also reveal what happened at last week’s hearing on cryptocurrency and blockchain technology regulation held by the US Senate Committee on Banking, Housing and Urban Affairs.

Read on to find out this and more!🍹



And a link for your friends and colleagues to subscribe!

Regulator UK 

X The Financial Conduct Authority (FCA) has confirmed that cryptocurrencies such as Bitcoin and Ethereum will fall outside its remit. The FCA considers these cryptocurrencies as ‘exchange tokens,’ and has said that such digital currencies do not fall under its regulatory scope. While attempts to create less volatile digital cash through so called stablecoins may be regulated (FN Financial News) 2 mins

Meanwhile, the FCA has warned that Bitcoin and other cryptocurrencies have “no intrinsic value” and offer consumers few protections. The warning came in a new report in which the regulator said that crypto markets were highly dysfunctional, and that the onus is on consumers to understand the risks of investing in unregulated assets. (Silicon) 2 mins

The FCA is urging consumers to “jog their memories” back to the 1990s and 2000s, in case they were mis-sold payment protection insurance (PPI). The final deadline for lodging a PPI claim is 29 August 2019. (The Guardian) 2 mins

The Bank of England (BoE) and the Prudential Regulation Authority (PRA) have finalised the last major piece of the Resolvability Assessment Framework. This framework is designed to help protect the economy and taxpayers from bank failure. Major UK banks with £50 billion or more in retail deposits will need to set out their preparations for resolution by 2022. (Financial Reporter) 2 mins

The Information Commissioner’s Office (ICO) has announced that it is teaming up with a number of companies to test innovations for data security compliance. The project comes as privacy regulators throughout Europe take greater steps to enforce the General Data Protection Regulation (GDPR). (Bloomberg Law) 2 mins

The UK Financial Reporting Council (FRC) has issued a fine to KPMG Audit PLC for its failings over a 2011 client assets reports for the Bank of New York Mellon Ltd. KPMG was fined £5 million, however, it was given a 30% discount for admitting to its misconduct. (Morningstar) 2 mins


Regulators US

The Wall Street Journal reported last week that in the US, the Federal Reserve recently investigated an Amazon cloud facility in Virginia, commencing what is expected to be an ongoing oversight of cloud providers. Amazon is the biggest player among the many technology firms and as a result, it has become an essential player in the US banking system. (Pymnts) 1 mins


Regulators Asia 

On the topic of cloud technology, the Association of Banks in Singapore (ABS) has published updated guidelines for financial institutions when they enter into cloud outsourcing arrangements. ABS said the updated guide represents a “substantial revision” from its original publication in 2016 as it considers technological advancements and the evolution of market practices. (The Business Times) 2 mins

China’s central bank has issued draft rules on financial holding companies in a move to reduce risk. The rules require companies with two types of financial business, such as banking, insurance, asset management, and securities brokerage, to apply for a financial holding company licence within six months of the new regulation taking effect, and they will have to have at least 5 billion yuan in registered capital. (South China Morning Post) 3 mins


Large fines handed out by the ICO could get organisations to take GDPR rules more seriously. In July, the ICO announced its intention to fine British Airways £183 million and Marriott International £99 million. (Computer Weekly) 2 mins



London-based RegTech firm FNA has announced closure of a $5.5 million Series A investment round. Founded in 2013, FNA enables financial institutions to map and monitor complex financial systems and simulate operational and financial risks. (Finextra) 2 mins

Volkswagen Bank, a subsidiary of Volkswagen AG, has ditched its inhouse-developed regulatory reporting solution and adopted BearingPoint’s Abacus360 Banking Regulatory RegTech solution. (FinTech Futures) 2 mins

RegTech could be driving a ‘cloud revolution’, as the deployment of new applications and the migration of core systems onto the cloud is in full swing. As a result, financial institutions could soon be free of the legacy shackles that have prevented them from moving forward into the age of digitalisation. (Finextra) 4 mins



Digital bank Revolut has recently launched a commission-free stock trading service across Europe, starting with a gradual rollout to a number of its Metal card customers. (Finextra) 2 mins

Revolut’s valuation could surge to $10 billion in the coming years according to a board member and one of Europe’s top venture capitalists. The digital bank, which is planning to raise as much as $500 million this year from investors, has accumulated six million customers in just four years. (The Telegraph) 2 mins

The success of neo-banks and FinTech firms has shifted the paradigm in which traditional banks operate. Just a few years ago, banks still cited their physical branches as a competitive advantage over neo-banks. However, things are very different today. (Forbes) 3 mins



Last week, the US Senate Committee on Banking, Housing and Urban Affairs held a hearing on cryptocurrency and blockchain technology regulation. During the hearing, Senate Banking Committee Chairman Mike Crapo said that the US could have difficulty banning Bitcoin. (Forbes) 3 mins

Also at the hearing, Mehrsa Baradaran, Professor of Law at the University of California Irwin School of Law stated that Bitcoin was not suitable for a public payment system, while Circle’s Jeremy Allaire argued that the current financial system is in need of transformation. (Cryptovest) 2 mins

Central banks could see the impact of their monetary policies diminish significantly if Facebook’s Libra cryptocurrency becomes widely used in their countries, warned Hiromi Yamaoka, former head of the Bank of Japan’s division overseeing payment and settlement systems, last week. Yamaoka believes that Libra could accelerate capital flight in countries where market trust in their currencies is low. (Reuters) 2 mins

Now is the time for banks to embrace artificial intelligence technology across the organisation, writes Jim Marous, co-publisher of The Financial Brand and publisher of the Digital Banking Report. Marous says that in many organisations, there is a lot of discussion of the benefits and potential of artificial intelligence, but little actual deployment of the technology. (The Financial Brand) 3 mins



Britain’s largest bookmaker, Ladbrokes Coral, has been hit with a £5.9 million fine over failure to prevent money laundering. Gamblers were allowed to deposit large sums over a number of years despite clear warning signs they may have been using stolen funds. (The Independent) 2 mins

The Serious Fraud Office (SFO) has received 153 reports concerning an allegation of money laundering since 2014, yet has only prosecuted four cases. (City AM) 2 mins