Name: Tech tools to combat fraudsters: How can FIs adopt and adapt?
Uploaded: 2023-06-13T11:56:24.890Z
Duration: 451.68
Description: Jas Randhawa, Managing Partner, StrategyBRIX, joins us to talk about the challenges of combatting financial crime and the use of technology in this space. Stay up to date with the community on https://finovate.com/ Find out more about FinovateSpring on http://www.finovatespring.com/

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Jas Randhawa.vtt

English

{{00:00:05}}
William Mills: Hi, I'm William Mills.

{{00:00:06}}
I'm here at FinovateSpring
in San Francisco.

{{00:00:08}}
Joined by my friend Jas Randhawa, and he
is a managing partner of StrategyBRIX.

{{00:00:13}}
How you doing today, Jas?

{{00:00:14}}
Jas Randhawa: Pretty good, William.

{{00:00:15}}
Thank you for having me here.

{{00:00:16}}
William Mills: Hey, I really
liked your panel earlier.

{{00:00:18}}
Jas Randhawa: I appreciate that.

{{00:00:19}}
Thank you for being there.

{{00:00:20}}
William Mills: I thought it was strong.

{{00:00:21}}
I thought it was strong.

{{00:00:22}}
Thank you.

{{00:00:22}}
So you're managing
director at StrategyBRIX.

{{00:00:24}}
So what do you see now as, what are
some new or current challenges related

{{00:00:30}}
to financial institutions facing when
they're there's, looking at crime?

{{00:00:34}}
Financial crime

{{00:00:35}}
Jas Randhawa: so the two themes
predominantly that are gonna exist

{{00:00:39}}
this year and next year, the first
bigger one being cost optimization.

{{00:00:44}}
So everybody's looking to cut
cost and be more effective

{{00:00:48}}
from an operational standpoint.

{{00:00:51}}
And the next one, which has been a bit
of a consistent theme for a while is

{{00:00:57}}
to for, compliance to be able to go and
support growth and The progress of the

{{00:01:02}}
businesses that they're supporting and
to be able to go head to head and making

{{00:01:06}}
sure that they're more of an enabler than
somebody who's slowing business down.

{{00:01:11}}
William Mills: So Jas I was in a, I
was watching a panel yesterday and

{{00:01:14}}
they said the number one technology
FIs need right now is fraud solutions.

{{00:01:21}}
So what, kinds of technologies can
financial institutions use right

{{00:01:26}}
now for good to combat fraud?

{{00:01:30}}
Jas Randhawa: There are one
or two fundamental technology.

{{00:01:33}}
I'm not gonna go into what vendors
are out there, but financial services

{{00:01:37}}
institution, they need to get a really
good handle on both AI and machine

{{00:01:41}}
learning, predominantly more than ai.

{{00:01:44}}
That what that's gonna enable them
to do is to be able to go and more

{{00:01:49}}
proactively detect and prevent financial
crimes, knowing who they're doing

{{00:01:53}}
business with, better optimize K Y
C and K Y B for faster onboarding.

{{00:02:00}}
This is a technology that most banks have
either tried to outsource to vendors.

{{00:02:07}}
But I think the time has come when
this talent is more within the banks

{{00:02:11}}
and they can they can build more model
than technologies based on machine

{{00:02:15}}
learning to be more cutting edge,

{{00:02:17}}
William Mills: so it doesn't sound
like it's something easily outsourced,

{{00:02:20}}
Jas Randhawa: so you,
you can outsource it.

{{00:02:22}}
There are vendors out there who can
help you and they can hold your hand.

{{00:02:26}}
But even as a consultant, I would
love the fact that they end up

{{00:02:30}}
outsourcing these kind of jobs to us.

{{00:02:32}}
But the right thing for banks to do is
to build that muscle in-house, right?

{{00:02:36}}
To be able to move their business forward.

{{00:02:39}}
William Mills: Are there any besides
AI and machine learning, are there any

{{00:02:42}}
other new tools that, are being used or
need to be used to fight financial crime?

{{00:02:47}}
Jas Randhawa: So you are seeing a lot
of in the in the onboarding space,

{{00:02:53}}
which has to deal a lot with identity
verification, K Y C and K Y B.

{{00:02:59}}
There are a lot more global vendors out
there today that can give you a much

{{00:03:03}}
better coverage, which means that what has
happened over the last couple of years is.

{{00:03:08}}
Regulators have still
been very fragmented.

{{00:03:11}}
They're still doing what they do in
their own little remit and countries.

{{00:03:16}}
But business has become very
crosswater and very international.

{{00:03:20}}
It's very hard for you to be
a US or a UK only business.

{{00:03:25}}
You will have to go across borders,
but to be able to go and meet

{{00:03:28}}
obligations for onboarding across
in other countries, you need to have

{{00:03:32}}
a consolidated technology approach.

{{00:03:34}}
So there are vendors out there that are
able to hold your hand in being able to

{{00:03:37}}
give you those kind of holistic solutions.

{{00:03:39}}
That's the one advice you have for
clients, for them to go and pursue.

{{00:03:43}}
William Mills: That makes sense.

{{00:03:44}}
And as a consumer, what do you think
financial institutions ought to do to re

{{00:03:50}}
reassure their customers, whether it's.

{{00:03:52}}
Retail consumers or businesses that
what the bank's doing is making

{{00:03:57}}
a difference in protecting them.

{{00:03:59}}
Jas Randhawa: So that's a
very interesting question.

{{00:04:03}}
I think what is first of all,
commonality important is to understand.

{{00:04:08}}
I, strongly believe that the
consumer is actually, has been ready

{{00:04:10}}
for change for a very long time.

{{00:04:13}}
The analogy that I would use is when
when Google was launched, every new

{{00:04:18}}
iPhone is put out in the market.

{{00:04:21}}
The consumer is not as apprehensive
to use that technology, right?

{{00:04:25}}
They're using that technology
because it's more cutting edge.

{{00:04:27}}
It makes our lives easier and better.

{{00:04:30}}
But at the same time the banks need
to work very closely with regulators

{{00:04:34}}
and internal model bodies to make sure
that the data of the consumer is being

{{00:04:39}}
protected, the consumer's interest
is being protected, and there are.

{{00:04:43}}
A couple of financial services
institutions that have products

{{00:04:46}}
out there that might, not, might,
or might not have all the consumer

{{00:04:50}}
protection barriers around them, right?

{{00:04:52}}
That's something that they
should be focusing on.

{{00:04:54}}
And the one example that I would put
out there is if you have products that

{{00:04:59}}
let's say are geared more towards younger
children, younger minds, teenagers

{{00:05:05}}
we have to be very cautious in making
sure that some of the decisions that

{{00:05:10}}
we're asking them to make there are
some protective measures so that they

{{00:05:13}}
can do the right thing for themselves.

{{00:05:15}}
William Mills: Now banking as a
service is coming hugely popular.

{{00:05:18}}
Is there anything that banks can do to
help prevent red flags going up with the

{{00:05:23}}
regulators with their FinTech partners?

{{00:05:26}}
Jas Randhawa: Great question.

{{00:05:27}}
So again this year, next year
specifically in the developed

{{00:05:33}}
markets, There's gonna be an intense
amount of focus that the regulators

{{00:05:37}}
are putting on the best providers.

{{00:05:40}}
Fintechs traditionally have
built businesses on the backs

{{00:05:44}}
of bank sponsors, correct?

{{00:05:45}}
Bank sponsors are the regulated
bodies and they in some form download

{{00:05:51}}
their obligations to fintechs.

{{00:05:54}}
And for good or bad reasons, they've
not had a great history of having the

{{00:05:59}}
best oversight of the FinTech obligation
that they've downloaded to them if

{{00:06:03}}
they've been executing well on them.

{{00:06:05}}
The regulators are hammering hard
these bank partners and asking them

{{00:06:09}}
to do the right things and making
sure that they have proper governance

{{00:06:12}}
and audit measures over the fit tax.

{{00:06:15}}
And that's a trend that you're gonna
see over over the next couple of years.

{{00:06:19}}
I think very specifically
transparency in onboarding K Y C

{{00:06:25}}
data, transactional data, right?

{{00:06:26}}
Sars, which are being filed
with the government bodies

{{00:06:29}}
that FinTech generally do.

{{00:06:31}}
That information will have to be
transmitted a lot more seamlessly

{{00:06:34}}
to the banking partners, and
they should have more oversight.

{{00:06:37}}
So that they can go back and report and
explain this back to the regulators.

{{00:06:40}}
William Mills: So in closing what is
the one thing, if you could only leave

{{00:06:44}}
one thought with a financial institution
that you're meeting with, but thinking

{{00:06:47}}
about financial crime, what is the one
thing that they can do best prevent

{{00:06:52}}
financial crime in their institution?

{{00:06:53}}
Jas Randhawa: Technology
technology, you've gotta have

{{00:06:56}}
the best technology stack.

{{00:06:58}}
And that just doesn't mean
buying good technology solutions.

{{00:07:01}}
You need to have the tech muscle within
your bank, within your payments company,

{{00:07:05}}
within your FinTech to make sure you
understand the technology, you optimize

{{00:07:09}}
it to your need and you're able to
optimize it and make it work for you

{{00:07:13}}
in the best in the best interest of the
financial services institution you are.

{{00:07:17}}
William Mills: Makes sense.

{{00:07:17}}
Jas, look forward to seeing you at
FinovateFall in New York this fall.

{{00:07:21}}
And again, this is William Mills.

{{00:07:23}}
At FinovateSpring in San Francisco.

{{00:07:25}}
Thank you.

I'm here at FinovateSpring
in San Francisco.

Joined by my friend Jas Randhawa, and he
is a managing partner of StrategyBRIX.

William Mills: Hey, I really
liked your panel earlier.

So you're managing
director at StrategyBRIX.

So what do you see now as, what are
some new or current challenges related

to financial institutions facing when
they're there's, looking at crime?

Jas Randhawa: so the two themes
predominantly that are gonna exist

this year and next year, the first
bigger one being cost optimization.

So everybody's looking to cut
cost and be more effective

And the next one, which has been a bit
of a consistent theme for a while is

to for, compliance to be able to go and
support growth and The progress of the

businesses that they're supporting and
to be able to go head to head and making

sure that they're more of an enabler than
somebody who's slowing business down.

William Mills: So Jas I was in a, I
was watching a panel yesterday and

they said the number one technology
FIs need right now is fraud solutions.

So what, kinds of technologies can
financial institutions use right

Jas Randhawa: There are one
or two fundamental technology.

I'm not gonna go into what vendors
are out there, but financial services

institution, they need to get a really
good handle on both AI and machine

That what that's gonna enable them
to do is to be able to go and more

proactively detect and prevent financial
crimes, knowing who they're doing

business with, better optimize K Y
C and K Y B for faster onboarding.

This is a technology that most banks have
either tried to outsource to vendors.

But I think the time has come when
this talent is more within the banks

and they can they can build more model
than technologies based on machine

William Mills: so it doesn't sound
like it's something easily outsourced,

Jas Randhawa: so you,
you can outsource it.

There are vendors out there who can
help you and they can hold your hand.

But even as a consultant, I would
love the fact that they end up

But the right thing for banks to do is
to build that muscle in-house, right?

To be able to move their business forward.

William Mills: Are there any besides
AI and machine learning, are there any

other new tools that, are being used or
need to be used to fight financial crime?

Jas Randhawa: So you are seeing a lot
of in the in the onboarding space,

which has to deal a lot with identity
verification, K Y C and K Y B.

There are a lot more global vendors out
there today that can give you a much

better coverage, which means that what has
happened over the last couple of years is.

Regulators have still
been very fragmented.

They're still doing what they do in
their own little remit and countries.

But business has become very
crosswater and very international.

It's very hard for you to be
a US or a UK only business.

You will have to go across borders,
but to be able to go and meet

obligations for onboarding across
in other countries, you need to have

So there are vendors out there that are
able to hold your hand in being able to

give you those kind of holistic solutions.

That's the one advice you have for
clients, for them to go and pursue.

And as a consumer, what do you think
financial institutions ought to do to re

Retail consumers or businesses that
what the bank's doing is making

Jas Randhawa: So that's a
very interesting question.

I think what is first of all,
commonality important is to understand.

I, strongly believe that the
consumer is actually, has been ready

The analogy that I would use is when
when Google was launched, every new

The consumer is not as apprehensive
to use that technology, right?

They're using that technology
because it's more cutting edge.

But at the same time the banks need
to work very closely with regulators

and internal model bodies to make sure
that the data of the consumer is being

protected, the consumer's interest
is being protected, and there are.

A couple of financial services
institutions that have products

out there that might, not, might,
or might not have all the consumer

That's something that they
should be focusing on.

And the one example that I would put
out there is if you have products that

let's say are geared more towards younger
children, younger minds, teenagers

we have to be very cautious in making
sure that some of the decisions that

we're asking them to make there are
some protective measures so that they

William Mills: Now banking as a
service is coming hugely popular.

Is there anything that banks can do to
help prevent red flags going up with the

So again this year, next year
specifically in the developed

markets, There's gonna be an intense
amount of focus that the regulators

Fintechs traditionally have
built businesses on the backs

Bank sponsors are the regulated
bodies and they in some form download

And for good or bad reasons, they've
not had a great history of having the

FinovateSpring

Expert Insight

Trend

Jas Randhawa, Managing Partner, StrategyBRIX, joins us to talk about the challenges of combatting financial crime and the use of technology in this space. 

Stay up to date with the community on https://finovate.com/ 

Find out more about FinovateSpring on http://www.finovatespring.com/ 