TRANS-PACIFIC MARKSMANSHIP: LOCAL TARGETS FOR STATESIDE REGULATORS
Technological innovation in the finance sector allows institutions to engage with customers and deliver services in meaningful and sometimes novel ways. Financial institutions (FIs) are subject to increased regulatory scrutiny as authorities grapple with the industry’s new business models. Regulators are focusing, in particular, on financial crime risk and the abuse of financial services to facilitate illegal activity.
Firms need to keep abreast of enforcement trends and key areas of regulatory concern around financial crime, and take proactive, effective and sustainable steps to build compliance frameworks.
In Australia, firms should monitor regulatory imperatives in the US, not only in Australia. US regulatory oversight is relevant to FIs in the Asia-Pacific region, including Australia, for two main reasons. First, the cross-border nature of financial activity and the extraterritorial reach of regulators mean that some US agencies are motivated and empowered to supervise Australian-based firms. Second, Australian regulators often follow trends and priorities set by their US counterparts.
Additionally, in the wake of the Aukus security pact, governments in Australia and the US will work cooperatively to address threats to national security, including those presented by financial crime.
This article explores how and why US regulators take an interest in financial activities in Australia, some of the key trends with respect to regulation of financial crime, and how firms can best prepare themselves to satisfy US compliance regimes.
Jan-Mar 2022 Issue
Norton Rose Fulbright Australia