FCN: What is the Future of Financial Intelligence Sharing (FFIS) research programme? And when and why did you get involved?

NM: FFIS is a research and international knowledge exchange programme specifically focused on the role of public–private information-sharing to improve AML/CTF outcomes. We’ve published independent comparative research and hosted scores of workshops around the world to better understand the opportunities and challenges related to the rise of public–private financial information-sharing partnerships (FISPs) in tackling financial crime. Previously, I have spent time serving in Afghanistan, analysing financial flows to insurgency, and then led the research programme on proceeds of international corruption coming into London for Transparency International. I’m very motivated by improving results from the AML/CTF system and the real world consequences of doing so. I started the FFIS programme in 2016 because I believed that more research on these topics could provide a step-change in how policy-makers and others think about tackling financial crime. There’s always room for knowledge exchange and it is a very exciting area to be part of.

FCN: How Important are FISP’s

NM: For countries that have established public–private financial information-sharing partnerships, these FISPs appear to have changed the way in which economic crime and terrorist financing can be understood, analysed and addressed. These partnerships have demonstrated how law enforcement, regulatory and intelligence agencies and financial institutions can work collaboratively to analyse and disrupt shared threats, rather than acting in isolation. Between JMLIT, FMLIT, ACIP, EFIPPP, FinCEN Exchange, Fintel Alliance, and others, there is now a wide range of partnerships (and acronyms!) supporting enhanced flows of information between public and private entities to detect and disrupt financial crime.

Data relating to the positive impact of partnership activity, for both public and private sector participants, is becoming increasingly available. Overall, this data indicates that partnerships have contributed to improvements in: the quantity and quality of reports of suspicion related to particular economic crime threats; the timeliness and relevance of such reporting to active investigations or live incidents; arrests, asset recovery or other disruption of criminal networks; and heightened understanding of risk in both the public and private sectors. We detail the available data from 2018 in the FFIS study ‘Expanding the Capability of Financial Information-Sharing Partnerships’ published in March 2019. 

FCN: How significant are FISPs?

NM: The role of these partnerships is arguably relatively small when considering, say: the scale of financial crime threats; or as a proportion of total law enforcement effort against economic crime; or in terms of the membership of partnerships in proportion to the regulated community and sectors as a whole.

Tactical-level partnerships have generally delivered a specialist capability to advance high-end, or particularly challenging cases. Overall, they have not yet been resourced to provide a more substantial and wide-ranging contribution to tackling economic crime. For private sector members, partnerships are currently voluntary, additional and parallel to the principal obligations which arise from the respective national anti-money laundering/counter-terrorism financing (AML/CTF) regimes.

FCN: Can they be scaled up, and move from the tactical to the operational?

NM: The RUSI ‘Future of Financial Intelligence Sharing (FFIS)’ programme,” spent 12 months in 13 jurisdictions, holding 22 high-level events with public and private partnership leaders and other expert stakeholders to better understand what the appetite, opportunities and challenges exist in relation to expanding the role of these partnerships. It is not immediately obvious how current partnership models might scale up. Partnerships have been very ‘human’ and perhaps even, in some cases, ‘personality’ orientated and reliant. The current scope of partnerships has clear benefits in terms of the impact that can be achieved with relatively limited public sector resources; the high-quality two-way interaction that can be facilitated within in-person briefing formats, given a manageable number of participants; the ability, in many jurisdictions, to involve a large proportion of the producers of suspicious reports with only a relatively small number of institutions; and the relatively high levels of trust that can be developed in small groups, processing small volumes of information. There are challenges related to increasing the operational capacity and membership of partnerships, without undermining the format, trust and interpersonal dynamics which have supported the success of current models.

FCN: So what do you think will happen to these FISPs

NM: The status quo of partnerships appears unsatisfactory. Policymakers and leaders in the regulated community may wish to achieve a greater magnitude of law enforcement impact with the support of partnerships, or to use partnerships to develop a higher tempo of both tactical and strategic intelligence. They may also wish to support more regulated entities and sectors contributing to and benefiting from membership of partnerships. Policymakers may wish to achieve the ambition of real-time information exchange and move beyond models characterised by manual and slow information transfer, low technology, limited visibility of the financial sector outside retail banking and limited bandwidth to process operational cases.

FCN: What are the FFIS Programme Findings?

NM: The FFIS programme identified a number of themes, including both challenges and opportunities, for policymakers and others to consider in order to enhance the capabilities of their respective partnerships.

These 11 themes will have different relative importance for different jurisdictions. There is no ‘one size fits all’ in partnership development. Policymakers have new options and new capabilities and a range of challenges and opportunities to resolve. Jurisdictions have an opportunity to make a conscious determination of the appropriate role and capacity of partnerships to achieve their national AML/CTF strategies. The 11 themes and corresponding recommendations, set out in our March 2019 report, are intended to support national and international policymakers, supervisors, enforcement agencies, FIUs and regulated entities to leverage the benefits of responsive reporting while mitigating the challenges of scale. We hope that the FFIS framework can support further national and supranational discussions about what role and ambition partnerships should have in any given AML/CTF regime.