Select Page
Hong Kong’s Securities and Futures Commission Hosts Forum to Drive Responsible Adoption of RegTech

On 4 November 2024, the Securities and Futures Commission of Hong Kong concluded its Anti-Money Laundering and Counter-Financing of Terrorism Regulatory Technology Forum 2024. This forum was held to encourage the financial services sector to adopt regulatory technology responsibly to combat money laundering and terrorism financing. With over 300 participants, including government officials, industry experts, and financial sector representatives, the forum marked a significant step toward enhancing regulatory compliance and risk management through advanced technology.

The central aim of the forum was to promote the widespread and responsible adoption of regulatory technology, commonly referred to as Regtech, within Hong Kong’s financial services industry. This aligns with the Securities and Futures Commission’s goal of building a resilient financial sector with robust anti-money laundering and counter-financing of terrorism practices. In conjunction with the event, the Hong Kong Securities and Futures Commission released its Report on the Adoption of Regulatory Technology for Anti-Money Laundering and Counter-Financing of Terrorism, which outlines the current progress, primary drivers, and practical examples of Regtech use cases.

The full-day forum opened with remarks from Julia Leung, Chief Executive Officer of the Hong Kong Securities and Futures Commission, who strongly urged the financial industry to take advantage of the opportunities presented by regulatory technology. Ms Leung stressed the importance of Regtech in creating cost-effective compliance solutions, noting that “it is more affordable than you think, especially compared to the heavy cost of overlooking money laundering risks.” Her statement highlighted the need for financial institutions to weigh the cost of Regtech adoption against the potential financial and reputational damages associated with failing to address money laundering risks.

Ms Leung also introduced the Hong Kong Securities and Futures Commission’s newly published report, which provides a roadmap for Regtech adoption across the sector. This report offers insights into the progress Hong Kong’s financial sector has made in integrating Regtech, identifies key factors driving its adoption, and outlines practical applications for enhancing anti-money laundering and counter-financing of terrorism efforts. Through this roadmap, the Securities and Futures Commission aims to make compliance more streamlined and effective, strengthening the overall integrity of Hong Kong’s financial system.

Joseph Chan, Acting Secretary for Financial Services and the Treasury, delivered a keynote address, reinforcing the significance of collaboration within the financial sector to improve compliance through regulatory technology. Mr Chan called upon the industry to leverage advancements in artificial intelligence and financial technology, suggesting that collective efforts could help Hong Kong establish a resilient, competitive, and responsible financial ecosystem. His message resonated with the forum’s focus on creating a technologically advanced financial environment that upholds rigorous anti-money laundering and counter-financing of terrorism standards.

One of the key sessions of the forum was led by Dr Eric Yip, Executive Director of Intermediaries at the Hong Kong Securities and Futures Commission, who hosted a panel discussion with senior representatives from the Hong Kong Customs and Excise Department and the financial industry. This session addressed emerging trends in money laundering risks and highlighted the transformative potential of Regtech in managing and detecting these risks. Dr Yip emphasised the value of regulatory technology in processing large volumes of data, enabling financial institutions to detect and respond to risks related to money laundering and terrorist financing promptly and effectively. This data-driven approach, he explained, allows for proactive risk management, positioning Regtech as an essential tool in the modern regulatory landscape.

(Source: https://apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/doc?refNo=24PR188)