by Pinkston, on Nov 12, 2020 2:44:53 PM
Shiffman urges FinCEN to focus on measurement of AML program outcomes to drive technology adoption and incentivize much needed reform
ARLINGTON, Va. – Gary M. Shiffman, Ph.D., responded to the Advance Notice of Proposed Rulemaking (ANPRM) on AML program effectiveness by recommending significant and immediate changes to FinCEN’s definition of “effectiveness” and “efficiency.”
Shiffman writes, “I have spent my career engaged in the global fight against illicit violence and coercion...I have developed familiarity with FinCEN over many years, and I congratulate the team, as well as the BSAAG AMLE WG, on the work represented by this ANPRM.”
However, Shiffman urges adoption of methods to measure outcomes. “I am writing to suggest that technology has not only changed the nature of financial crimes threats, as FinCEN identifies, but also the nature of the countermeasures available to government and industry...The dramatic evolution in technology over the past decade, specifically today’s easy access to Machine Learning (ML) and Artificial Intelligence (AI), changes the very way in which FinCEN, regulators, and regulated financial institutions (regardless of size and type) can measure effectiveness and efficiency.”
Shiffman encourages FinCEN to consider the measurement of meaningful outputs, such as law enforcement prosecutions and the achievement of other national security goals. Shiffman suggests that “...FinCEN consider output and not just input (i.e. law enforcement actions and not number of SARs filed), and adopt the following terminology for any regulatory changes to address the effectiveness and design of the AML system: true positive, true negative, false positive, and false negative.”
See the Giant Oak response page for the full letter to Director Blanco.
To learn more about Giant Oak, visit giantoak.com. To learn more about Consilient, visit consilient.com.