Wirex and Elliptic unite in new approach to make cryptocurrency safer

Wirex and Elliptic have strengthened their collaboration in order to reduce the risk of cryptocurrency fraud and money laundering. The new remit solidifies the relationship between the two companies as Wirex becomes Elliptic’s first partner to proactively contribute data on fraudulent accounts.

Borderless payments platform Wirex and Elliptic, the leading cryptocurrency compliance provider, have been working together since 2016 to help counter and prevent money laundering and other illicit uses of cryptocurrency. Users of Elliptic software will benefit from this enhanced collaboration as Wirex red-flags wallet addresses associated with illegal and suspect activity. This paves the way for a new data model built on industry-wide collaboration and best practice, ultimately reducing the risk of fraud and promoting the benefits of cryptocurrencies to a wide audience.

Wirex offers consumers and businesses secure, multi-currency accounts to manage digital and traditional currencies, make fast and efficient domestic and international payments and spend cryptocurrency in day-to-day life using the Wirex Visa card.

By bridging the gap between digital and conventional payments, Wirex is able to identify fiat-based financial crimes, such as stolen credit card details, that ultimately lead to cryptocurrency wallet addresses being used for money laundering. Fraudulent or suspicious behaviours are now fed directly into Elliptic’s dataset of high-risk actors in cryptocurrency.

Elliptic has assessed risks for transactions worth several trillion dollars, enabling cryptocurrency exchanges, brokers, banks and other financial institutions across the world to prevent illicit activity and provide secure and trusted services.

Pavel Matveev, CEO and Co-Founder at Wirex said: “We have entered a new age in which conventional regulated financial frameworks and the new token economy must coexist. By uniting the existing and future financial ecosystem, Wirex occupies a unique position in the industry – we believe it is our duty to deliver innovation and choice to our customers whilst ensuring the security of their money and data. We are delighted to work with Elliptic and contribute to creating a safer environment for all.”

James Smith, CEO & Co-Founder of Elliptic said: “The cryptocurrency community continues to work collaboratively with innovative approaches to strengthen security across the industry. Our new working arrangement with Wirex will play a significant role in helping cryptocurrency become more trusted and commonplace. This enhanced partnership is yet another milestone for companies working together with this shared purpose.”

Drooms and Oodrive announce exclusive strategic partnership to win over Europe’s sensitive data market

Drooms, the leading provider of virtual data rooms in Europe, and Oodrive, the European leader in sensitive data management, today announce the signing of an exclusive commercial agreement. Both parties will market their joint solution in their respective markets: France and French-speaking territories for Oodrive, and Germany and German-speaking territories for Drooms. The companies share common approaches and values and by enhancing their offerings, they aim to win new market shares.

Complementarity and expertise

Oodrive, a French specialist in highly-secure collaboration and electronic signature solutions, meets the highest French and international certification standards and requirements with regards to sensitive data processing. It provides a solution in over 90 countries and for over 15,000 customers, including BNP Paribas, Banque de France, Axa, DGA, Air Liquide, Airbus, Kering, Air France and other companies in a range of sizes and sectors, including 80% of CAC 40 companies.

Drooms, the Frankfurt-based company, is operating in the virtual data room market, with sales offices across Europe. Its technology gives enterprises controlled access to large quantities of confidential data. Owing to the renowned quality of its proposition, Drooms leads the European market and has gained the trust of large corporations such as METRO GROUP, Deloitte, KPMG, PwC, JP Morgan, CBRE and UBS, as well as numerous SMEs.

Both businesses are set to profit from each other’s innovational expertise and local distribution network. A staff exchange is part of the cooperation: a team from each partner will join Oodrive in Paris and Drooms in Munich.

Data protection made in Europe

An important factor in the initiation of the partnership is the similarity in mindsets of the two companies. Both believe that data security will be the major issue of the future, as recent events confirm the risk of European company data migrating to the US with the support of both the Patriot Act and CLOUD Act via US companies or their European subsidiaries.

Both companies stress the high security of their servers, Board Communication and Data Room products as independent European companies.

Alexandre Grellier, Co-founder and CEO of Drooms, comments on the partnership: “We are thrilled to be cooperating with Oodrive, whose focus on – and commitment to – security, trust and performance so clearly matches our own. Our alignment will create substantial value for our clients in terms of ease-of-use and security. They will particularly benefit from our common drive for innovation and our regional expertise.”

Édouard de Rémur, Co-founder and Senior Vice President of Oodrive, adds: “It is vital that French and European actors start using data sovereignty software solutions, especially when it comes to sensitive data management. Furthermore, they need to realise that there are credible alternatives to American providers, who do make quite a stir, but whose products are not as advanced as ours, and who also must comply with the CLOUD Act. For a long time Oodrive and Drooms have focused their efforts on creating expert and highly-developed products in their own sectors. It is now time for our companies to lay claim to excellence and make it known throughout Europe. Our partnership is a perfect opportunity to do so.”

JCRA launches new online financial risk management portal for finance directors, portfolio managers and accounting teams

JCRA, the independent financial risk advisor, today announces the launch of Ada, the new digital financial risk management portal for finance directors, portfolio managers and accounting teams. Ada provides real-time access to debt and derivative portfolios and treasury and accounting reports. Ada is named after Ada Lovelace, the 19th-century visionary British mathematician and computer pioneer whose former home at 12 St James’s Square in London is the European headquarters of JCRA.

Through Ada, clients can quickly access an overview of debt and derivative instruments in their portfolio or drill down into individual entities and instruments to the mark-to-market (‘MtM’) value. Clients are further able to view individual instrument cash flows and LIBOR fixings, for both historical and projected values.

JCRA clients will have instant access to a range of risk management reporting tools. This includes projected MtM reports, which illustrate implied MtM projections by instrument; cash flow reports to show scheduled interest and principal payments for debt and interest rate derivatives; cost of funds and projected cost of funds reports; hedge ratio reports that show projections for hedged and unhedged debt positions as well as positions split by fixed and option based hedging. Clients can view all reports at group and entity level.

Commenting on the launch of Ada, Jackie Bowie, CEO of JCRA, said: “We feel very fortunate to work in a building that is so closely associated with Ada Lovelace and are delighted to launch our new platform in her name. Thanks to Ada, accounting for derivatives via manual spreadsheets will be a thing of the past. Furthermore, Ada will strengthen clients’ existing treasury management systems and reduce the financial reporting burden for finance directors, portfolio managers and accounting teams who have to manage often complex derivatives portfolios. Ada will consolidate the vast quantity of derivatives information, positions and documentation into one easy-to-use, well-organised digital platform that provides a live and swift overview of transactions.”

Ada is an IFRS9, USGaap and UKGaap (FRS102) derivatives accounting solution that provides MtM reports with credit valuation adjustment (‘CVA’) and a debit valuation adjustment (‘DVA’). Clients can make journal entries for cash flow hedge accounting instruments and non-designated hedges. They have cash flow hedge accounting support, which includes designations, regression testing and ineffectiveness measurement based on hypothetical derivatives. JCRA will also provide year-end quantitative disclosures including liquidity risk, market risk and long-short split.

What you need to know before trading with South America

A country report on South America has been published for export-focused businesses by trade credit insurer Atradius.

With information hailed as key to building solid foundations for export growth, the latest country report by Atradius provides an update on the political and economic backdrop of five main South American markets. Atradius assesses the risk rating for each market as well as comparing key indicators from GDP growth, inflation and unemployment to private consumption, industrial production and export rates. Atradius economists have ranked Chile as the lowest risk South American country within the report with a ‘moderate to low’ trading risk and ‘positive’ outlook. Peru and Columbia are ranked ‘moderate to low’ risk with a ‘stable’ outlook and Brazil is considered a ‘moderate’ risk with ‘positive’ outlook. At the higher end of the scale, Argentina is rated as being ‘moderate to high’ risk with a ‘stable’ outlook.

Highlights:

  • Argentina: The economy has avoided default for the time being but this has led to deepening austerity measures and economic contraction. Political uncertainty is high due to the presidential election later this year, which could mark the end of current economic adjustment policies. Agriculture and food are the strongest performing industries with a ‘good’ performance outlook. The outlook for chemicals, paper and services is ranked as ‘fair’.
  • Brazil: The new administration has set out an ambitious reform agenda to boost the economy while economic rebound is set to continue. Business insolvencies are expected to decrease 5% in 2019, albeit on elevated levels compared to pre-crisis years. Financial services and food are rated with a ‘good’ performance outlook with agriculture, chemicals, paper and services rated as ‘fair’.
  • Chile: Political stability remains high in Chile and the business environment continues to be one of the best in the region as the government continues to stimulate foreign investment and the economy’s shock resistance remains strong. Atradius has rated the automotive, chemicals and food sectors as having a ‘good’ performance outlook while the outlooks for agriculture, electronics, financial services, paper and services are ranked as ‘fair’.
  • Colombia: The economy is forecast to grow circa 3% in 2019 and 2020, driven by higher oil prices, improved investments and greater consumptions. The external economic position remains solid with significant economic progress. However, there are still high rates of poverty in rural areas. Automotive has the most positive outlook, ranked as ‘excellent’ by Atradius, with agriculture, construction, consumer durables, electronics, financial services and food all rated ‘good’. Most other industries are described as having a ‘fair’ outlook.
  • Peru: GDP is growing, sustained by higher commodity prices and robust domestic demand alongside an increase in private consumption and elevated confidence. To sustain growth, structural reforms need to continue. The construction and food sectors have a ‘good’ performance outlook while the agriculture, automotive, chemicals, consumer durables, electronics, financial services, machines, paper and services sectors have a ‘fair’ outlook.

James Burgess, Atradius’ regional manager for London and the South East, said: “With a more connected global network, export activity need not be constrained by geography and businesses are increasingly looking further to expand into new markets. South America has some prime opportunities for exporters due to its size, purchasing power and growing emerging markets. However, diligent research is essential to building strong foundations for successful trade. Astute businesses can work with their broker and trade credit insurer to help identify the best opportunities and mitigate risk, forming an effective trade partnership to achieve growth.”

Equifax moves to new City of London office at Bank

Equifax, the consumer and business insights expert, has today moved offices to 1 Angel Court, Bank, at the heart of the City of London.

Previously located in Marylebone, the move will place Equifax at a prestigious central London address within ten minutes’ walk of seven mainline and underground stations. It brings the firm closer to a large number of its key business partners and provides a modern, highly equipped premises for hosting clients. The change also offers an enhanced working environment for colleagues with improved onsite facilities to attract future talent and facilitate growth.

The new state-of-the-art office at Bank features floor-to-ceiling windows offering panoramic views of London, as well as a garden terrace, business lounge and onsite restaurant. The 8,700 sq ft office space is equipped with all the latest technology, while the specially designed open-plan layout embraces new flexible working methods, with additional spare seats to encourage and facilitate collaborative working.

Patricio Remόn, President of Europe at Equifax, said: “After 24 years at our previous office, we wanted to move closer to our key clients to help foster and grow our strong working relationships. As a progressive organisation, it was a key priority to deliver an improved working space for the 100 people we have based in London. We look forward to enjoying the many benefits of this new bustling location at the heart of the UK financial centre and welcoming our many client partners to this new and inspiring workspace.”

One Savings Bank appoints Jaywing as independent risk model validation partner, as it embarks on its IRB programme

Credit risk analytics experts, Jaywing, announces that it has partnered with specialist lender One Savings Bank within its second line function, to independently review and challenge its models, with the first task being the rating system as part of its IRB programme.

An increasing reliance on models, regulatory pressures and changes, and talent scarcity is driving banks towards external experts for trusted long-term risk model validation. Recent focus from the regulator and raised awareness of the consequences mean the stakes in managing model risk have never been higher.

That’s why One Savings Bank put potential model validation suppliers through a rigorous vendor selection process. To support their selection of a partner, the bank commissioned trial validation projects to each qualified vendor in the selection process. The bank then used the output of the trial projects, coupled with a proposal and vendor interview process to select their preferred partner.

With Jaywing’s model validation expertise, One Savings Bank can achieve a greater level of independent model assessment ensuring models are fit for purpose while adhering to regulatory requirements.

Nicholas Hurst, Deputy Chief Risk Officer at One Savings Bank, commented: “It was vital we selected a partner with a strong track record in credit risk analytics and which boasted impressive modelling capabilities. This is why we put potential vendors through a rigorous selection process. We were quickly struck by the level of Jaywing’s expertise and the success of its models in ensuring adherence to regulatory requirements and managing model risk effectively. We’re really looking forward to working with Jaywing on our IRB programme, which is a vital strategic project for us”.

Nevan McBride, Risk Practice Director, Jaywing, added: “We are delighted to be selected by One Savings Bank, especially following the rigorous vendor selection process. It was important that One Savings Bank choose a qualified partner with the technical and regulatory modelling expertise and an ability to place a forensic eye across a range of model types. We are delighted to have exemplified these attributes and look forward to performing our role as independent model validation partners to help the bank achieve their goal of becoming IRB compliant.”

This appointment follows Jaywing’s extensive experience in credit risk analytics gained over the last 20 years’, helping many lenders including Nationwide, RBS, Secure Trust Bank and Paragon Bank with IFRS 9, IRB, stress testing, ICAAP, credit grading and a variety of other risk requirements.

Fraud risk puts sellers off online marketplaces

Over two fifths (43%) of people are put off selling items or services online due to the risk of fraud according to newly published Fraud Tracker data from Shieldpay, the secure payments provider.

The rise of online marketplaces, such as Facebook Marketplace, Gumtree and Shpock, has supported a rapid increase in people buying and selling items online. As many as 30% of the population has sold an item or service, such as plumbing or carpentry, online, that equates to nearly 16 million people1. However, this has exposed more of the population to fraudulent activity. Nearly half (47%) of people who have sold an item or service online have fallen victim to fraud and on each occasion the seller loses, on average, £2,0542.

This raises the question of whether online marketplaces are putting the correct measures in place to safeguard not only buyers, but also sellers. Just one in five (19%) people believe online marketplaces are doing enough, 45% think sellers must take their own steps to ensure the transaction is protected and 23% believe the protections that are in place are designed purely for the buyer. Worryingly, 20% of people aren’t aware of the tricks that buyers could use to fraud a seller.

Tom Clementson, Director of Consumer and SMB at Shieldpay, said: “It’s not just buyers who are at risk in the online world. Millions of sellers have fallen foul of fraudsters and it’s putting people off using online marketplaces. Sellers turning away from online marketplaces poses a real threat to the industry, especially as it transforms to a model which depends on transaction revenue.

“This should be a wake-up call; to improve safeguards for sellers and ensure both buyers and sellers can transact without the fear they will lose out. The adoption of increasingly sophisticated technology is one solution that can help eliminate the risk. Shieldpay gives sellers and buyers confidence by verifying the parties and holding money for a transaction securely until all parties are happy to release the funds, enabling stress-free and safer shopping online.”

Shieldpay recently partnered with Rated People to offer protected payments and give consumers and the 50,000 skilled tradespeople that use Rated People a safe way to transact. Previously, once a home improvement job had been agreed, payment had to be completed by bank transfer or cash payment – leaving both sides open to fraudulent activity. Shieldpay’s patented payments process not only allows homeowners to have more control over their money, it also reassures tradespeople that the money is there to pay them for their work and protects both parties from fraudulent payments.

Impact Specialist Finance and UTB in packager agreement

Impact Specialist Finance, the specialist mortgage broker and distributor, has announced a packaging agreement with United Trust Bank (UTB) which will allow it access to the specialist lender’s whole product range.

United Trust Bank has dedicated divisions providing mortgages, bridging finance, development finance, structured finance, asset finance and motor finance. For mortgages It has a limited master broker panel and a select number of strategic packager partners

In January, All Types of Mortgages (AToM) rebranded as Impact Specialist Finance as the family run business moved into its 28th year in the specialist sector.

Dale Jannels, Managing Director at Impact Specialist Finance, commented: “We are looking forward to building a strong relationship with United Trust Bank who we believe will further strengthen our proposition across a number of specialist lending sectors.

“UTB is a lender which is making some real waves in the specialist lending markets. This packaging agreement will allow our intermediary partners and clients access to bespoke and flexible funding solutions for borrowers across a wide range of circumstances.

“These are exciting times for Impact Specialist Finance as we look to build on the success of our recent rebrand and further establish ourselves as one of the premier mortgage brokers, packagers and distributors in the market.”

Buster Tolfree, Commercial Director – Mortgages, at United Trust Bank, added: “Impact Specialist Finance is one of the most recognisable broker and distributor firms in the UK, with a presence across the whole lending product suite. Their team is highly experienced, with a level of knowledge that reflects their 28 years of experience in the sector.

“At UTB we are consistently expanding our products, services and presence in the specialist lending sector and we look forward to starting a new and successful partnership with Dale and his team as we continue to grow our Mortgage & Bridging proposition.”

An innovative approach to defeating cheque fraud

In our first whitepaper of 2019, Fighting Cheque Fraud in the 21st Century: Cheque Fraud Detection in the New Clearing Model, it was explained that whilst volumes have steadily fallen during the 21st century, the cheque is now a modernized and very efficient money transmission option. In fact, just seventeen months ago, this resilient payment instrument perhaps underwent its most significant revamp to date, as the first phase of the highly anticipated Image Clearing System (ICS) came into effect.

ICS: The journey so far

This saw a clearing infrastructure put in place to accept and switch data and scanned images, in lieu of the actual paper cheque. As a result, cheques are ‘truncated’ (digitised) at the point of deposit and are no longer transported during the clearing process.

ICS went live on 30 October 2017 with, initially, very low volumes, however, the number of processed items has significantly and steadily grown over recent months.

Since its introduction, industry commentators have overwhelmingly agreed that ICS has dramatically enhanced the efficiency of the cheque as a payment tool. For instance, all items deposited on a weekday will be cleared by no later than 11.59pm the following weekday – a huge improvement compared to the previous 2-4-6 model.

As we reach the spring of 2019, it is fair to suggest that ICS is in the final stages of its roll-out, and by the end of Q2 the industry expects the system to be fully deployed.

Recognition of fraud

During the early implementation of ICS, there was a widespread industry expectation that professional fraudsters would test the new system and those expectations have been met. It is understood that increased attempts to defraud the cheque payment system have been made but it is encouraging to note that the vast majority have been foiled due to a combination of the historic paper-based fraud prevention processes and procedures, as well as the success of the first wave of Image Survivable Features (ISF), which has been typified by the use of UCNs (Unique Coded Numbers). Refer to our earlier whitepaper for access to cheque fraud figures.

Traditional fraud prevention measures

The traditional security features, which are both overt and covert, include but are not limited to printed devices involving the use of invisible ultra violet ink, as well as the use of fugitive and solvent sensitive inks. These are part of the prevailing regulated Cheque Standard – which is known as Cheque & Credit Clearing Company (C&CCC) 3.1 – and they remain the requirement for the printing of all cheques in the UK.

In the new image world, the document only retains a value, for the purposes of clearing, up until the point at which the cheque is digitised. This can be as early as its receipt by the payee whereupon an individual or a small business could, by agreement with its bank, capture the image using a smartphone app and deposit the cheque remotely into the clearing infrastructure. This process is achieved in the corporate sector with the use of a desktop scanner, which can process multiple cheques at one time. As a result, as soon as the cheque has been remotely deposited the paper document has no legal value and can be destroyed.

At this point, the visible features retained in the image are the only active elements that can prevent fraud attempts from the point of deposit until the clearing of the funds. The work the industry is undertaking to ensure that features retained in the image are active, robust and verifiable, is the key to enhanced fraud prevention in image-based clearing.

For many years, images of cheques have been taken as part of the clearing process even though the paper has, until now, remained the clearing instrument. Elements of those images – such as the nature of the handwriting, the positioning and profile of the signature, and the payee name and amounts – have and will continue to form the basis of a fraud prevention profiling exercise, which is undertaken by DIA Europe (Kappa).

The growth in Image Survivable Features

The historic and ongoing image-based fraud profiling tool (as discussed above) now has greater significance, due to the invalidity of the paper document once any image has been submitted. This is being supplemented by the introduction of new and enhanced ISFs – and these are under continuous development – the most established of which is UCN.

UCN has been deployed by the majority of financial institutions in the UK, which enables the Kappa profiling tool to additionally the match the UCN (typically an alphanumeric string printed visibly in two places on the front of every cheque) to the magnetic ink code line to ensure that it is authentic, it has not been altered, and that any representation of the code line genuine and not a counterfeit.

Another new and exciting feature involves the addition of a QR (‘Quick Response’ ) two dimensional barcode on the face of the cheque, which incorporates not only the magnetic ink character recognition (MICR) line – the account number, sort code and serial number of cheque – but also the key variable data, such as the payee name, the amount in value and the date of the issuance of the cheque.

This feature has been developed jointly by the TALL Group of Companies and DIA Europe/Kappa, and introduced under the registered trade name UCN Plus ®and made available to corporate users, financial institutions and SMEs. Many such cheque issuers use in-filling software applications, which apply the variable data and the code line at the point of issuance. This is where the UCN Plus feature automatically generates an encrypted data stream, which drives the application of the two-dimensional bar code (QR code) and is then decoded and matched within the clearing infrastructure by the fraud prevention platform (DIA Europe – Kappa).

Looking ahead

The industry envisages further developments to support the fraud prevention solutions delivered through ISFs, and the TALL Group of Companies intends to inform the industry, and educate users, as to the importance, simplicity and cost effectiveness of such features as they emerge.

By Martin Ruda, Group Managing Director, The TALL Group of Companies

Atom bank select TruNarrative for next generation protection against financial crime

TruNarrative are proud to announce their latest partnership with the UK’s first bank built exclusively for mobile or tablet, Atom bank plc, to provide an AML transaction monitoring and financial crime customer screening and monitoring solution.

The Durham-based bank offers Fixed Saver accounts, secured business lending for SMEs and residential mortgages. Atom’s commitment to innovation, disruption and providing a safe environment for customers has been core to their growth and ensures they remain a genuine alternative to established banks in the UK.

Atom’s desire to evolve current capabilities and work with TruNarrative represents their focus on innovation, and demonstrates an understanding that legacy and traditional services limit their disruptive capability and competitive advantage.

Regulatory changes and the digital nature of contemporary business, combined with fast evolving criminal threats, means regulated entities must be proactive in their adoption of technology and in designing process that will absolutely solve these modern day challenges. Legacy solutions and processes will not always provide the flexibility, agility and innovation required to cope with these demands. Innovation and rapid implementation are key focuses for the Atom and TruNarrative partnership.

Atom’s overarching criteria for selecting a real-time AML transaction monitoring and a financial crime (adverse media, PEP & Sanctions) customer screening solution, was for a platform which would support future products and safeguard against emerging risks in the market.

The key priorities included:

  • A single solution to avoid decision and operational issues with silos
  • It must be real-time, both in decisions and in ability to make changes
  • It must be able to reduce and manage false positives effectively
  • It must be reliable and prove the ability to scale

In addition, during the selection process, Atom identified further justification for choosing TruNarrative, including:

  • Clear focus on disrupting the industry and focussing on leveraging technology (aligned with our ethos)
  • Powerful system – layering rules across multiple service providers
  • Good configurability levels, providing the user with clear capability to undertake critical actions without support
  • Provides a clear path to reduce false positive rates
  • Clear track record of financial crime prevention in financial services

John Lord, CEO at TruNarrative said: “Atom bank represent a fantastic strategic partner for TruNarrative. It’s proof our innovation and accuracy in building next generation financial crime tools is ahead of the game. We are looking forward to working with them for years to come, protecting their customers and accelerating their growth.”

Helen Hassen, Head of Financial Crime at Atom bank said: “In selecting a partner for financial crime prevention there were three key focus areas: innovation, configurability and capability. TruNarrative demonstrated a passion for innovative financial crime prevention methods and are clearly driven by challenging legacy systems and issues in the industry.

“They provide excellent levels of configurability and flexibility in their platform, allowing Atom to respond quickly to AML/CTF threats in a controlled way. It is clear that TruNarrative have already established a track record of improving financial crime prevention capabilities in their platform and their collaborative approach will add real value to our solution.”