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Blockchain to ‘radically’ transform anti-fraud, anti-money-laundering efforts

Blockchain could be the answer to increasingly tough anti-money laundering (AML) statutes and enterprise fraud management (EFM) requirements looming for the financial services industry.

In a report released this week by Forrester Research, blockchain’s distributed ledger technology – because it is both secure and immutable – is ideal for meeting new government requirements and serving as a trusted repository for identification purposes.

“This makes it a trusted repository for providing device ID, known fraudster, transaction and other blacklists used in AML and EFM,” Forrester said in the report. “Updating these repositories will no longer be the privilege of AML and EFM vendors only. In addition to these existing vendors, new identity coin and social identity verification vendors and [financial institutions] themselves will be able to update crucial blacklists.”

Governments are also considering using blockchain networks to secure sensitive data, but none as of yet have, according to Martha Bennett, a principal analyst at Forrester Research and co-author of the report.

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