We're excited to announce that the team received 314b designation from FinCEN. It's the key to unlocking better AML and compliance in finance.
The problem this helps us solve
In finance, there's no permanent criminal record.
If someone stole money or laundered it at one financial institution, another may not know what happened. This is because sharing customer data between institutions is heavily regulated and challenging. Criminals use this visibility gap by intentionally committing fraud and money laundering across multiple banks, Fintech companies, and businesses to hide their tracks.
So what can financial institutions and non-banks who want to prevent criminals and money laundering do?
The challenge with data sharing
Sharing data is hard.
Companies have countless data privacy, compliance and security concerns to consider. Personally identifiable information (PII) has to be highly protected by law, and if exposed data leaks can be costly to any organization.
Your bank or Fintech company is rightly cautious about sharing this with 3rd parties and will avoid doing so. As a result, companies can only manage what they can see. In exceptional cases they may contact other financial institutions for an investigation but they’re flying blind without source data to work from.
However under US law there is a solution
“USA PATRIOT Act Section 314(b) permits financial institutions, upon providing notice to the United States Department of the Treasury, to share information with one another in order to identify and report to the federal government activities that may involve money laundering or terrorist activity. “
Why 314b Designation is important
Sardine recently received the 314b designation from FinCEN (Financial Crimes Enforcement Network). This designation demonstrates that the company meets the regulatory requirements and guidelines for sharing information related to anti-money laundering (AML) and counter-terrorism financing (CTF) efforts.
Now any financial institution can benefit from the secure dataset Sardine has built across our bank, Fintech and Crypto client base.
Sardine’s data sharing platform.
Sardine has built a bespoke API, allowing any financial institution that registers to pull data securely for the purposes of fraud or AML.
How it works:
- A participant can request information about an entity from the shared database by sending identifiable information (personal or account details) via an (API) call. Participants only disclose this information to the consortium; no other participant can access that private data.
- The information is matched to a UID within the database, and the service instantly compiles available risk data on that entity and returns the data via API in response.
- Lastly, the participant will provide feedback on each query, and the consortium will incorporate the results into the entity’s UID.
You can find a full overview of the platform from Ravi here.
It also means that if a financial institution suspects money laundering, they can call the Sardine APIs to determine if the customer transacting with their institution has been flagged elsewhere in financial services for money laundering and terrorist financing risk.
Together we can shine a light on the criminals hiding in the shadows between financial institutions.
- The financial institution can meet all regulatory responsibilities like filing a Suspicious Activity Report (SAR) to FinCEN with much more detail.
- And law enforcement can take action with complete information incorporated in the SAR
If you’d like to learn more about the criminal record for Fraud, AML, and financial bad actors, get in touch. We’re open to meeting new partners and helping your institution benefit from this data set.
If you want to learn more why not drop a line to Ravi@sardine.ai.