Built a unique AML/CFT service for Japanese market using Secure Payments
Secure payments has allowed JSOL to:
- Detect and prevent suspicious transactions using Artificial Intelligence
- Provide real-time screening of SWIFT messages
- Innovate by bringing an industry leading AML/CFT solution to Japanese market
- Lower the cost of deploying advanced transaction monitoring with scalable SaaS technology
Customer overview
JSOL Corporation was formed by NTT DATA and The Japan Research Institute. It combines the advanced technology and business know-how developed during its days as The Japan Research Institute in a broad array of fields from finance and public services to production with the all-encompassing power of the NTT DATA Group to provide high-quality ICT services and solutions.
JSOL is an established ICT solution provider in Japan with a history of delivering technological innovations to customers in domestic and overseas markets. Growing SWIFT compliance requirements and a Financial Action Task Force (FATF) assessment of AML compliance in 2019, has placed a greater spotlight on how well financial institutions are able to identify and act on suspicious transactions and user behaviour.
ICT Solution provider partners with Bottomline to enhance monitoring capabilities for SWIFT messages.
JSOL identified a gap in the market for financial institutions that want to comply with current and future regulations. Misono Yasushi is a Consultant at JSOL Corporation and the Project Manager of the Secure Payment implementation project as well. He is responsible for driving digital innovation and incubating new business opportunities by working with partner organisations.
JSOL wanted to proactively respond to the evolution of the cyber threat landscape and it has partnered with Bottomline Technologies to integrate the Secure Payments AML solution with JSOL’s SWIFT Service Bureau.
Mr Yasushi says, “Japanese Financial Institutions face an ever-increasing Anti-Money Laundering (AML) and Counter Financing of Terrorism (CFT) compliance burden. We, therefore, wanted to partner with an established transaction monitoring solution provider as Japanese institutions tend to favour established solutions that are proven to detect and prevent risk.
“Bottomline’s Secure Payments solution had everything that we were looking for. It uses advanced Artificial Intelligence which is a core part of our own solutions so there was a natural fit. It is already used by many financial institutions worldwide for transaction and user monitoring.”
SWIFT CSP 2.9A ‘Transaction Business Control’ requires organisations to enhance monitoring of SWIFT transactions. As regulations get tougher, this requirement may become mandatory which will mean that Japanese institutions will need to act by implementing Secure Payments or a similar solution in order to maintain compliance.
Lower cost of deployment with SaaS
JSOL’s SWIFT Service Bureau provides connectivity to SWIFT Alliance Access for transmission of SWIFT messages. There are many regional banks in JSOL’s customer base and as a SaaS-based cloud service, Secure Payments has an immediate advantage of lowering the system implementation cost as there are no hardware or software costs to worry about.
Mr Yasushi explains, “We were able to quickly integrate the JSOL SWIFT Service Bureau to Secure Payments using a connector which helped minimise the investment from JSOL to bring this solution to the Japanese market. Thanks to the SaaS model, Secure Payments is highly attractive for both Japanese institutions and for us as a provider. It gives us scalability so that we can add more users without requiring more resource which lowers our costs too.
A pilot of Secure Payments is underway with seven early adopters. There are no solutions currently available to Japanese organisations that enable real-time filtering of suspicious SWIFT messages. Secure Payments enables the detection of abnormal transactions that were previously not detectable before which is a big step forward for Japanese institutions.
JSOL uses SWIFT Sanctions Screening for AML filtering. Messages are then sent securely in real-time to the Bottomline Secure Payments server in Singapore. Secure Payments enables customers to enhance how they detect suspicious transactions which are blocked and flagged for further investigation.
Our customers place importance on the value of Artificial Intelligence and Secure Payments uses advanced machine learning to monitor user behaviour which mitigates risk. The combination of Secure Payments and SWIFT Sanctions Screening give JSOL customers the most comprehensive AML/CFT protection available.”
Real-time monitoring for highest level of compliance
With Secure Payments, JSOL can provide new services to our customers which increases the value it can deliver. JSOL plans to go live with the real-time transaction monitoring service on February 1st 2020.
Mr Yasushi explains, “We have received positive feedback from our users in the pilot program who report that they were able to look at their transactions in a different way and find potentially abnormal transactions.”
This means they can take preventative action to review and secure suspicious transactions before they are released into the SWIFT network. The real value that it will bring to our customers is that it will enable them to be more proactive at detecting and stopping fraudulent payment messages.
It enables institutions to go beyond meeting current SWIFT CSP compliance requirements. Secure Payments enables institutions to apply the highest level of AML/CFT compliance for SWIFT payments.
We recognise that the Japanese AML/CFT sector is underdeveloped compared to other international financial markets. By adding Secure Payments to the portfolio of services that JSOL provides, we believe that we will see a lot of demand from financial institutions and also it will gain attention from the Japanese government.”
“Secure Payments will allow customers to strengthen security controls, reduce risk and comply with SWIFT compliance requirements. It will help to reduce potential vulnerabilities by providing real-time monitoring capabilities for SWIFT messages."
Coping with evolving compliance requirements
Mr. Yasushi concludes, “The FATF inspection has made AML into a new focus area for Japanese financial institutions with international banking operations. The market is maturing and the evolving SWIFT compliance requirements will put pressure on institutions to react to new regulations.
JSOL will be well-positioned to help customers meet any new recommendations from SWIFT such as CSP 2.9A but also CSP 6.4 ‘Detect Anomalous Activity to Systems or Transaction Records’ which is all about logging and monitoring user behaviour.
In the future, as regulations get tougher, we’ll have first-mover advantage from already having integrated Secure Payments into our portfolio of services for financial institutions. We anticipate strong interest from customers that want to meet compliance requirements and lower the cost of achieving this compliance.”
