Lockdown or Knock-out? Part 3: In the USA and Brazil, Covid-19 inexorably strikes

20 July 2020
Knowledge Base

by Michel Klompmaker

The WHO has reported a record number of new infections worldwide in recent days. The health organisation reported last Saturday that 224,260 new infections worldwide were registered in one day. And then we are only talking about the cases known to WHO. It can be guessed that the situation is even more serious, because even in a civilised country like the Netherlands, many infections were simply not reported. But what does this mean for the global economy? Let’s take a closer look at two major players from across the ocean, then it will soon be clear that the worst is yet to come. Most reports from the past few days come from the United States and Brazil. Together these countries account for almost half of all new infections worldwide, but many people in India have also tested positive for the virus. A few figures: The number of new worldwide registered new infections in the week of June 29 – July 5 was 1,230,000. Last June, the WHO recorded a record number of new infections of 5,303,000 compared to more than 2,300,000 last April. Continue reading…

Basel Committee finalises AML/CFT guidelines on supervisory cooperation

15 July 2020

The Basel Committee on Banking Supervision has recently issued the updated version of its guidelines on Sound management of risks related to money laundering and financing of terrorism: revisions to supervisory cooperation, with guides on the interaction and cooperation between prudential and anti-money laundering and combatting the financing of terrorism (AML/CFT) supervisors for banks. These guidelines are intended to enhance the effectiveness of supervision of banks’ money laundering and financing of terrorism (FT) risk management, consistent with and complementary to the goals and objectives of the standards issued by the Financial Action Task Force (FATF) and principles and guidelines published by the Basel Committee. Continue reading…

Lockdown or Knock-out? Part 2: Texas and Trump

13 July 2020
Knowledge Base

by Michel Klompmaker

In many parts of the world, the coronavirus has been ruthless. This is also the case in the southern states of the USA. Viewed from a Western European perspective, the pandemic appears to be somewhat extinguished, but this is by no means the case from the perspective of the coronavirus itself. Very worrying is the recent increase in the worldwide number of registered infections from about 10 million on June 27 to more than 13 million on July 12. In part two of our series “Lockdown or Knockout?” we take a moment to reflect on what has recently happened in Texas and in passing we take the opinion of a German virologist from the University of Bonn. Continue reading…

Research conducted by the FCA shows that there has been a 1.1 million increase in cryptoasset purchasers

09 July 2020
Knowledge Base

Recent research conducted by the Financial Conduct Authority (FCA) has revealed that approximately 2.6 million consumers in the UK have purchased cryptoassets at some point in time. This essentially marks an increase of 1.1 million since the FCA carried out a survey face to face on the same topic in 2019. Among the 1.9 million UK consumers that still have cryptoassets in their possession, such as Ripple, Ether, or Bitcoins, about half of them hold more than £260. This research conducted by the FCA is a part of its work with the Government and Bank of England in attempting to comprehend market size, profiles of consumers and what their attitudes are towards cryptoassets. Continue reading…

European Commission refers Member States to Court of Justice after failing to fully implement AMLD4 into their national law

07 July 2020
Knowledge Base

The European Commission last Friday referred Austria, Belgium and the Netherlands to the Court of Justice of the European Union, with a request for financial sanctions, for failing to fully implement the 4th Anti-Money Laundering Directive (AMLD4) into their national law. Executive Vice-President Valdis Dombrovskis said: “We have robust EU rules in place but they must be applied consistently and efficiently. We will make sure that everyone in both private and public sectors applies the rules rigorously. We have launched many infringement procedures to ensure the full transposition and application of our rules.”  Continue reading…

Core points of focus while conducting audit engagements in regions with high fraud and corruption risks exposure

06 July 2020
Knowledge Base

by Alex Movchan

We recently conducted another interview with Olga Lukashenko who is an Audit Director at Reanda Netherlands. The first interview that was conducted with this special woman can be found on our platform under related items, which was about planning and executing audit engagements during the Covid-19 crisis. This particular talk with Olga covers the topic of conducting audit engagements in regions with a high level of exposure to fraud and corruption.  Continue reading…

Lieve Lowet

Lieve Lowet

EU Affairs consultant and lobbyist

The Solvency II review, Brexit, equivalence and calibrations

03 July 2020

On 23 June 2020, the UK Chancellor of the Exchequer gave a written statement in which he announced plans on the update of prudential requirements in several areas of the financial sector. Regarding Solvency II, the Chancellor made it clear that the UK will review certain features of the regime. Rishi Sunak mentioned the risk margin, the matching adjustment, the operation of internal models and the reporting requirement for insurers. The statement added that this list was not limited. It should be noted that, after all, Solvency II was very much inspired by the UK’s prudential regime. The list of the items the European Commission plans to consider in its first major Solvency II review exercise is much longer and overlaps gently with the hitherto limited list of the British Chancellor, eager “to take back control of the rules governing our world-leading financial services sector”. In a recent webinar, Didier Millerot, head of the Insurance and Pensions Unit of the European Commission mentioned as areas: the risk margin, the long term guarantee measures – the reason why the 2020 review after all was planned in the Omnibus II amendments of 2014 – and proportionality. But he also mentioned many other points such as the recovery and resolution process, a minimum level of national insurance guarantee schemes’ harmonisation, cross-border supervisory quality and supervisory cooperation – important in a cross-border freedom of services situation for the reputation of the Single Market -, green assets and the contribution of the insurance sector to the new sustainable economy. Nobody can be jealous of such a long list of items on which the Commission will have to ponder carefully whether to propose amendments and how.  Continue reading…


Efficient Frontiers

Simplifying the Customer Journey – Little changes, BIG impact

01 July 2020

Complexity, often associated with tax compliance, can touch multiple parts of the organisation creating several challenges. On one hand, there is a high financial and reputational risk associated with getting the tax compliance wrong. On the other hand, the volume and complexity of customer data that has to be processed is becoming an increasingly time-consuming challenge. Customer relationships can be won and lost based on their experiences with completion of important tax documentation.

This paper focuses on a recent case study that outlines how, using a winning combination of  EFI’s tax and technology expertise, a solution was developed for a client that streamlined their IRS W-Series Tax form process whilst achieving compliance.

Continue reading…

Lockdown or Knock-out? COVID-19: Are we going to play Russian roulette now?

01 July 2020
Knowledge Base

by Michel Klompmaker

We have decided to publish a series of articles entitled “Lockdown or Knock-out?” on this platform. We will discuss and comment on the current measures taken by the various governments, economic forecasts from experts and expectations of politicians from the perspective of risk & compliance. We are just going to start and as long as there is no vaccine for the coronavirus, we will regularly discuss the issues that are worthwhile. Today we start with the recent news about lending to business customers in the Netherlands. On the one hand, we see a decrease in the number of infections and deaths, but what does this actually mean for the economy if we put it in a somewhat broader perspective? Is there reason for optimism? We would like to spread the optimistic sound, but we cannot ignore the facts and that they are not good. Did circumstances leave no other choice or have the banks and the responsible minister switched to a form of Russian roulette? ING announced yesterday that it expects to triple the number of bankruptcies in the Netherlands next year. And in the meantime, since the outbreak of the corona crisis, the Dutch banking sector has provided additional credit of around EUR 14 billion. As a result, the percentage of gross national product corporate debt (IMF source) has risen again to over 150 percent. For the critical down-to-earth reviews, who like to make dismissive statements about the financial policy of the so called “garlic countries”: Italian corporate debts are in percentage at over 60 percent of the gross national product. Continue reading…

The Committee on Payments and Market Infrastructures and the International Organisation of Securities Commissions publishes a report on CCP auctions

29 June 2020

The Committee on Payments and Market Infrastructures (CPMI) and the International Organisation of Securities Commissions (IOSCO) have recently published a report entitled Central counterparty default management auctions – Issues for consideration.  The report outlines certain issues that central counterparties (CCPs) should consider regarding default management auctions processes. It also identifies practices that CCPs could consider in the development and improvement of default management auctions to address those issues. Continue reading…