The new FATF Recommendation 16 states that originator and beneficiary information must be included in wire transfers. Today, this information is missing or incomplete in a significant number of payments messages, posing potential compliance challenges for banks. In order to address these issues and help banks monitor their compliance with FATF16, the Payments Data Quality service checks messages after the fact using quality verification rules developed by SWIFT in line with industry practice and in cooperation with its global community. The new service also allows banks to consistently apply the agreed-upon set of verification rules based on FATF 16 guidelines, thus facilitating the development of industry standards globally.

The service highlights problem areas, identifies trends and provides the information compliance professionals need to conduct investigations within their payments systems and to take appropriate action. The service offers financial institutions:

• A global overview of the quality of originator and beneficiary information in their payments messages;
• Detailed analytics to help them identify potential risk related to specific countries, counterparties and branches;
• Trusted reporting from SWIFT as a neutral third party to support their internal investigations and discussions with their counterparties;
• A web-based platform eliminating the need to install, integrate or maintain additional systems.
“There is widespread recognition within the global banking community that not all payments messages contain adequate and complete originator and beneficiary information,” says Lene Baltzarsen, Senior Manager, Nordea Bank AB. “High-quality payments data is vital to a broad range of compliance activities, including sanctions screening, transaction monitoring, and the detection of data anomalies in payments messages. Nordea is committed to demonstrating industry leadership in sanctions risk management, and SWIFT’s new Payments Data Quality service represents a major step forward in supporting our compliance with the new FATF Recommendation 16 requirements and enhancing the overall effectiveness of our financial crime compliance programme.”

The new FATF guidelines have already been incorporated into the second EU Funds Transfer Regulation (FTR II - which itself is part of the Fourth EU Anti-Money Laundering Directive (AMLD IV), which will be enforced across the EU from June 2017. The guidelines have also been adopted by Singapore, with other countries expected to follow suit.

“The lack of standard practices for formatting some originator and beneficiary details in financial messages, such as addresses and bank account numbers, can make data detection by automated systems difficult,” adds Brigitte De Wilde, Head of Financial Crime Intelligence and Services, SWIFT. “It is also hard for banks with multiple platforms to maintain a global institution-wide view of payments data quality levels. Payments Data Quality is exactly the type of service that can alleviate these pressing issues, while promoting collaboration and facilitating the development of best practices and industry standards across the global banking community. We are delighted to have a major European institution like Nordea Bank as the first adopter of our new service.”