–> This is a pre-event interview in the run-up to the Leaders in Finance AML NL Event on 5 October 2023.
Jeroen: First of all, Helène, thanks for taking the time to speak to Leaders in Finance in the run-up to the Leaders in Finance AML Netherlands event on the 5th of October. First of all, could you introduce yourself?
Helène: It is good talking to you again, Jeroen, on our favourite topic; very relevant for my job as a Sector Coordinator AML and CFT at the Dutch Banking Association. Here, I am driving and managing both banks and parties on the public and private side, to improve the effectiveness and efficiency of our activities in the anti-money laundering space. I have considerable experience now in this field, by working at different banks in the Netherlands, and gathering over 30 years of experience in the financial industry. Now, I am focused at transforming that financial ecosystem towards a proportionate control framework to effectively disturb criminals, while making sure our clients experience as least impact as possible from these activities.
Jeroen: With all your experience within banks and now at the Dutch Banking Association, what is your view on the most important changes you have seen over the last few years? Or you can take a timeframe that suits you.
Helène: Looking back at my times at different banks in this field, we have seen a significant scale-up, and more strict supervision. Over the last year we have seen a change. We have closely engaged, also with our supervisor, on what is proportionate. Íf laws and regulations allow for risk-based room, let’s make sure that we use it. That works well if banks take a risk-based approach and we have risk-based supervision as well. To reach that open norms need to be clarified. And the change that I think has been good, has been in attitude and openness, where we have an active dialogue on what is adequate, and when is good, good enough? From the banks’ perspective, it is logical that we increased our efforts and the measures that we take to prevent misuse of the financial system when we see high risks. But the change in openness is now on when the risks are low. But that only works if we do that together with our supervisor. What we also have done, was creating a trialogue with the sector, supervisor and banks, since there were different sectors experiencing administrative burden or other difficulties. Together we needed a common understanding on what the real risks are. Pay attention to the real risks, but leave good guys in situations where risks are low and be comfortable in doing less. It has been quite rewarding to get that direct communication going. On 7 September, we presented our first Sector Industry Baseline for Not for profit organisations. A lot of work and dedication from those organisations, banks and the supervisor went into this Industry Baseline. Now reaching a shared view on which factors are indeed risk-increasing, but also which factors are reducing the risk of an individual Not for profit organisation. I am happy with the outcomes.
Jeroen: That is what I was going to say, actually, you sound quite optimistic. Since there are around 13 to 14 thousand people working in this industry within banks, I assume you are not only happy, although you sound quite optimistic. Or am I wrong?
Helène: I am not happy about the 13,000 people we need working in this business. Just think of the shortage in labour capacity that we have. Whether it is on the educational side or in health care, there are lots of things that these people could do. And that is the movement we need to make. Be more risk-based, be very targeted in what we do, and be more efficient. Do things once, and let’s not repeat what is not necessary. So this is the first step, if you want that common agreement, getting to those Industry Baselines, those standards. That should be a relief for clients and for banks. Keep the effectiveness by being very targeted in disturbing criminals, but also do less where possible.
Jeroen: What are the different topics in the Industry Baselines, just to sum them up?
Helène: Several. Basically, we have two categories. One category is the Risk-based Industry Baselines. Those are all about how we interpret specific open norms in the current legislation. So, we have done UBO identification and verification, some work on pseudo-UBOs and what we do with enhanced due diligence measures for EC high-risk countries. We also have got new ones coming up on source of funds, and on politically exposed persons. Another category, that is where on 7 September we had the first publication, is for specific sectors. Certain sectors experience higher impact or burden from the gatekeeper activities. Looking at those and getting a better understanding of what the real risks are and what we do, both by banks and the sector. The first one was for the Not for profit sector, and more will follow.
Jeroen: Thanks. Are there currently things that are not happening that you would like to see happen or see changed?
Helène: You said, “You sound quite happy”, but we still have quite a wish list as well. Just look at some recent publications by the public prosecutor. I think in the Netherlands, the gatekeeper role is often still seen as an equivalent to banks. But there are a lot more gatekeepers. And if we look at criminal money flows in the Netherlands, everybody immediately thinks of drug trafficking. But look at what they found out through the decryption of those PGP communications. A major part is not passing through banks but actually making use of underground banking networks. So what I am still looking for is – and you have heard me saying that – is that we need to focus on what the real risks are. But I think we also need to focus on what we can see, what we can detect as banks and what we can actually do to stop them. Because there is a lot of money laundering and criminal money flows that do not pass through banks. Or where, for instance, notaries or accountants can more easily detect illicit funds than banks. That is a conversation I think we need to have.
Jeroen: Do have particular tips for any person or stakeholder in the AML ecosystem?
Helène: I will give two tips. The first one is building on that there are more gatekeepers than banks. And that ecosystem is changing; think of payment institutions, crypto providers. To keep any financial transaction safe, we need transparent payment rails. So my advocacy would be: if it is the same risk, apply the same rules and supervision. So make the newer ones, the more tech enabled payment rails, fully transparent as well. The second one, and I am going to sound like a broken record: if we want to be targeted and proportionate, tell us where the real risks are and make sure that we get a valuable feedback loop from public parties, like law enforcement, sharing information with gatekeepers. Tell us what we can look for, what is looks like and what the modus operandi is. We would like to see the information on the modus operandi being fed back to the private parties. So in conclusion: create a valuable feedback loop.
Jeroen: The broken record is still very important. Now for the last question from my side. What are the things you are looking for at an event like the Leaders in Finance AML in the Netherlands in October, since you attend a lot of these kinds of events? What would be the things you would be interested in to learn or who would you like to meet?
Helène: I am really pleased that you have Jim Lee as a speaker. I spent some time and we did some work with him. So that is a good link, and I wonder how that will be experienced in the group of people that you have together, because there are certainly differences with the US. And one of the things that Jim and his crew do well is that they are transparent in a different way. They are transparent about the cases that they provide and on the results. Last year they successfully used BSA filings in 86% of their cases. More importantly, he also can give you a percentage on which cases they started based on BSA filings they received. So they are quite transparent and specific on results. Also published cases, some of the criminals they caught, some of the assets they confiscated. We, on the other hand, have discussions national and in Europe on information sharing and the AMLR. Whereas in the US there are less legislative discussions. What I also like in this event is that you have more tech components in your panels and those will be interesting exchanges. I hope somebody is going to ask some difficult questions about how far you can go. Let’s see how that will be received. It is a different experience from the other side of the Atlantic. I am looking forward to those tech panels.
Jeroen: Helène, that all sounds very interesting and we are very much looking forward to the event and to having the Dutch Banking Association represented there. For now I would like to thank you a lot for taking the time to speak to Leaders in Finance, Helène, and again, I am looking forward to seeing you on the 5th of October. Thank you!
–> This is a pre-event interview in the run-up to the Leaders in Finance AML NL Event on 5 October 2023.