On 13 July 2022, Elizabeth McCaul, Member of the Supervisory Board of the European Central Bank (ECB) delivered a speech at the conference on “The use of artificial intelligence to fight financial crime”.

Key points in the speech include:

  • Deficiencies in a bank’s anti-money laundering / countering the financing of terrorism (AML/CFT) framework are often symptomatic of deeper structural problems in governance, risk management, and internal controls.
  • Europe needs a strong AML authority underpinned by a single rulebook.
  • Cooperation between AML/CFT supervisors and prudential supervisors is essential for the ECB. While the ECB’s supervisory tasks explicitly exclude AML/CFT supervision of banks, the ECB must take into account findings related to AML/CFT in its prudential supervision.
  • Experience has shown that certain new entrants such as some Fintech companies have an insufficient understanding of their AML/CFT obligations and suffer from structural weaknesses in their customer due diligence and know-your-customer frameworks.
  • A key AI technology for banking supervision is natural language processing. This technology helps supervisors to improve the processing of large amounts of unstructured information and different types of text documents.