Regulatory compliance proved to be a key theme of last month’s Sibos 2013 conference in Dubai, with the impact of regulation in the Middle East region playing a leading role in the conversation, says Accuity.
The company, previously known as BankersAccuity, commented that the Middle East region has a unique challenge in dealing with new and upcoming regulation, in that while being a major financial trading hub for many western banks, it also serves the needs of its regional banking partners. Many banking organisations in the region have participation in sanctioned countries, and there is no regulation that prevents them from doing so.
Middle East-based banks have to delicately balance their own needs against servicing their regional bank neighbours, as well as their western counterparts. Further still, regulation introduces complexities in terms of the transparency that doing business with western banks require.
Trade finance often involves a complex web of individual players and holding organisations, and is moving up the regulatory agenda as organisations realise the importance of having to deal with compliance when operating in other less well regulated jurisdictions. Screening of imports and exports has therefore become a main area of focus for the trade finance industry, as organisations work to comply with international anti-money laundering and counterterrorist funding regulation in an increasingly complex environment. With Dubai and the wider Middle East region acting as a major international hub for trade finance, it has become an area of growing focus.
“Compliance has certainly received a lot of focus at this year’s Sibos,” commented Hugh Jones, chief executive officer at Accuity. “With the resurgence of trade products, there is a renewed interest in how complicated it might be to better understand the vessels that are participating in the shipment of goods, as well as the nature of the goods that are in the cargo. There has been a scrutiny on dual-purpose goods, that if sent to the wrong country could be used for criminal purposes.”
“From a compliance discipline, emerging markets introduce different levels of complexity. At Accuity, we’re striving to assist firms in applying sufficient sanctions screening capabilities. Organisations need to overcome the considerable hurdles faced when regulatory sanctions lists and well-practised screening engines are designed with an expectation of encountering Roman characters.”
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