Banks are struggling to obtain compliance-related information on client transactions through third-party, “peer-to-peer” payment processors, impeding their efforts to screen for suspicious activity, compliance officers told ACAMS moneylaundering.com. P2P platforms, a cornerstone of the burgeoning fintech industry, allow individuals with bank accounts or credit cards to transact almost instantaneously with each other through mobile applications like Venmo and Square Cash. Most P2Ps register as money services businesses and adopt compliance programs, but provide only scant information on counterparties to banks on either side of the transfer. According to a compliance officer for a large U.S. regional lender, the platforms generally...
In an attempt to expand their customer base and cut costs at a time of declining revenues, U.S. depository institutions are jumping into partnerships with online lenders that could draw regulatory scrutiny.
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