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Technology helps Lloyd's avoid the crooks

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9th Sep 2008
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Anti-money laundering regulations are beginning to bite with more big names announcing action to stop running foul of them. In the light of research that some UK-high street banks and Companies House have suspicious clients firms like Lloyd's of London are taking no chances. Gerry O'Kane speaks with its investigatory expert to find out which route he has taken.

In spite of not being required to fully implement the raft of anti-money laundering regulations within its world of corporate finance, Lloyd's has taken the plunge in using new technology for protection.

“You must understand the unique nature of Lloyd's – we’re a leader in the insurance market, we have supervisory responsibilities and face a certain amount of reputation and regulatory risk, we have to take a responsible view on handling money laundering activities,” explains Andy Wragg, senior manager, international market access at Lloyd's.

The increasing 'Know Your Customer' challenges, the scale, complexity and cost of screening customers against published sanctions lists, which are often inaccurate or incomplete, presents operational challenges that many have failed to overcome and are faced with a backlog. The institution bought Datanomic dn:Director Sanctions & PEP screening software as part of its internal central intelligence system. “We recognise that Lloyd's is a strong brand and we have a dedicated team to investigate financial crime at all levels and this is part of our armoury,” adds Wragg.

While enforcing practical measures are difficult, they are required. Corporates and banks are fully cornered by the regulatory initiatives, such as Basel II, MiFID, the 3rd EU Money Laundering Directive and the USA PATRIOT Act, although they do not fully apply to the insurance sector. However, with its origins dating back to the 17th century, its leading position in the insurance market running 80 syndicates and having licences in 200 countries, Lloyd's felt it needed to keep up.

Want to know more? Read the full version of this story on AccountingWEB.co.uk's sister site Finance Week.

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