ICYMI
Global
IAIS: Application Paper on the supervision of AI
The International Association of Insurance Supervisors (IAIS) has published the final version of its application paper on the supervision of AI. The paper, which has been updated following consultation in early 2025, reinforces the importance of the Insurance Core Principles (ICPs), and discusses the five key topics:
- risk-based supervision and proportionality;
- governance and accountability;
- robustness, safety and security;
- transparency and explainability; and
- fairness, ethics and redress. [2 Jul 2025] #AI
IAIS consults on draft Application Paper on operational resilience objectives and toolkit
The IAIS has published for consultation a draft application paper, which supports supervisors and insurers in understanding how to assess and address operational resilience in light of Insurance Core Principles (ICP) risk management and other relevant requirements.
The paper consists of the operational resilience objectives and the supporting practices and tools (the toolkit). The objectives provide an outcomes-based articulation of the application of ICPs in light of developments in operational resilience, while the toolkit provides a selection of practices that could be used to achieve (or work towards achieving) the objectives.
Feedback is requested by 29 September 2025. A public background session webinar will be held on 17 July 2025. [1 Jul 2025] #OpRes
UK
FCA: Individuals sentenced over £1.5m crypto fraud
The FCA has reported that two individuals have been sentenced to a combined 12 years of imprisonment for their roles in a £1.5m crypto fraud following a prosecution brought by the FCA. Between February 2017 and June 2019, the defendants cold-called victims and sold fake investments in crypto. At least 65 investors were defrauded, with losses amounting to £1,541,799. [4 Jul 2025] #Crypto
APPG on Fair Banking releases report on APP fraud
The All-Party Parliamentary Group (APPG) on Fair Business Banking has published a report analysing how effectively the UK is tackling authorised push payment (APP) fraud. The paper examines the early impact of the new Mandatory Reimbursement Requirement (MRR), and considers what further steps are needed to build a fairer and more effective system.
The report highlights that APP fraud remains a serious and evolving threat, with increasingly sophisticated scams and shifting tactics. It sets out a series of practical recommendations to inform the Government's upcoming update to the Fraud Strategy, including improved prevention, clearer regulation, stronger data sharing, and more robust support for victims. [3 Jul 2025] #Payments #APPFraud
BoE speech: Building tomorrow's markets – the digitalisation of finance
The Bank of England (BoE) has published a speech by Sasha Mills, Executive Director, Financial Market Infrastructure (FMI), delivered at the UK Finance Digital Innovation Summit 2025.
Discussing the foundations for the digitalisation of finance, Ms Mills noted that 'the time is fast approaching' for building new structures rather than trying to modify existing ones. She highlighted the BoE's work in laying the foundations for new structures, including the Digital Securities Sandbox (DSS), and the Digital Gilt (DIGIT) pilot. She also discussed the BoE's plans to consult on the UK's systemic stablecoin regime.
In terms of building on these foundations, Ms Mills sated that 'there is much still to put in place to graduate to a financial system that has the capability to deliver faster and cheaper settlement' and gave examples such as:
- resolving legal and regulatory questions to unlock more efficient use of a wider range of high-quality assets;
- supporting new entrants to the FMI landscape; and
- ensuring that as new and old structures are likely to co-exist in the financial system for some time, they can interoperate with minimal or no settlement risk. [2 Jul 2025] #Sandbox #DigitalAssets #Stablecoins #DIGIT
BoE speech: RTGS renewal, synchronised settlement and experiments in wholesale payments
The BoE has published the speech delivered by Victoria Cleland, Executive Director of Payments, at the 15th Annual City Week. Ms Cleland discussed the renewal of the Real-Time Gross Settlement (RTGS) system, plans for a synchronised settlement and the programme of experiments in wholesale payments. The experiments will include testing of where wholesale central bank digital currency (wCBDC) might offer advantages over synchronisation. A final report of the Wholesale Experiments Programme is planned for H2 2026. The report will also feed into the BoE's assessment of whether wCBDC offers tangible benefits that merit deeper exploration through additional experiments, alongside further improvements to RTGS. [2 Jul 2025] #Payments #RTGS #CBDC
FCA: Speech – Harnessing AI and technology to deliver the FCA's 2025 strategic priorities
The FCA has published a speech by Jessica Rusu, Chief Data, Information and Intelligence Officer, delivered at the AI and Digital Innovation Summit as part of City Week 2025. Ms Rusu spoke on the theme of harnessing AI and technology to deliver the FCA's 2025 strategic priorities.
Ms Rusu highlighted that firms will begin testing in the Supercharged Sandbox, a collaboration between the FCA and Nvidia, from October 2025. According to Ms Rusu, this new offering has greater computing capacity, enhanced data sets and more advanced tools.
The complementary AI Live Testing offering will open for applications during the week commencing 7 July 2025, and firms will begin using the tool from September 2025.
With regard to the FCA's own use of AI, Ms Rusu said that the regulator is 'testing large language models to analyse text and deliver efficiencies' in authorisations and supervision. Predictive AI is being used to assist supervisors and conversational AI bots are being used to redirect consumer queries to relevant agencies such as the Financial Ombudsman Service (FOS). [1 Jul 2025] #AI #Sandbox
RIO and DRCF to work together to streamlinine regulation to support the fintech sector
The Department for Science, Innovation and Technology (DSIT) has published a speech by the Technology Secretary, Peter Kyle, which was delivered at CityWeek 2025.
Mr Kyle announced plans for the Regulatory Innovation Office (RIO) to work with the Digital Regulation Cooperation Forum (DRCF) to 'cut red tape, and support fintech innovation, to fuel the government's Plan for Change'. In particular, the two bodies will work on a unified digital library that will provide ‘one stop' access to digital policy and regulations for innovators. [1 Jul 2025] #RIO #DigitalLibrary #DRCF
PRA: CFO roundtable summary – Future Banking Data project
The PRA has published a summary of its roundtable with CFOs from the largest, most systemic firms operating in the UK. The session focused on gathering feedback on planned work for the year ahead in relation to the Future Banking Data project, and also on its longer-term direction.
The PRA reported that there was broad support for its plans to delete little-used PRA rules-based reporting templates; the regulator will consult on an initial, targeted set of deletions by the end of the year. Firms also expressed support for the development of a firm-facing digital portal to facilitate more efficient engagement with the PRA.
Several themes emerged from the discussion on longer-term direction of travel. These will inform the development, by the end of 2025, of a vision for a multi-year programme of change in reporting that delivers tangible reductions to the costs borne on firms. The PRA will provide a further update to CFOs in Q3 2025.
The PRA also plans to publish a discussion paper on current data use and challenges; this will set out, at a high-level, why the PRA collects data and will include some wider use cases within the Bank of England (BoE). [1 Jul 2025] #Data
FCA consults on draft rules for targeted support for pensions and retail investments
The FCA has published Consultation Paper 25/17 – Supporting consumers' pensions and investment decisions: proposals for targeted support (CP25/17). In CP25/17, the FCA explains that targeted support will be a new form of support that will enable firms to provide suggestions designed for groups of consumers with common characteristics to help them make financial decisions.
The consultation also sets out the FCA's early thinking and direction of travel on simplified advice and clarifying the Advice Guidance Boundary. Noting the potential for AI to play a role and its own commitment to avoiding introducing additional regulation for AI, the FCA says it welcomes views on whether the rules it is consulting on are 'sufficiently future-proof'.
Responses to the consultation are requested by 29 August 2025. The regulator aims to publish a policy statement with final rules by the end of 2025.
In conjunction with CP25/17, the government has announced that, to enable the implementation of targeted support, it will publish a policy note setting out proposed changes to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001. The note and draft statutory instrument will be published alongside the Chancellor's Mansion House speech on 15 July 2025. [30 Jun 2025] #AI #RoboAdvice
Europe
OJ: RTS specifying subcontracting ICT services supporting critical or important functions under DORA
Commission Delegated Regulation supplementing Digital Operational Resilience Regulation (DORA) with regard to regulatory technical standards (RTS) specifying the elements that a financial entity has to determine and assess when subcontracting ICT services supporting critical or important functions has been published in the Official Journal of the EU (OJ).
This Regulation will enter into force on the twentieth day following that of its publication in the OJ. [2 Jul 2025] #DORA
ECB commits to DLT settlement plans with dual-track strategy
The European Central Bank's (ECB's) Governing Council has announced the approval of a plan that will enable settling distributed ledger technology (DLT) transactions using central bank money. The initiative follows a two-track approach: the first track (known as 'Pontes') provides a short-term offering to the market – including a pilot phase – and the second track (known as 'Appia') focuses on a potential long-term solution. The decision is in line with the Eurosystem's commitment to supporting innovation without compromising on safety and efficiency in financial market infrastructures.
Pontes will offer a Eurosystem DLT-based solution, linking DLT platforms and TARGET Services to settle transactions in central bank money. The Eurosystem plans to launch a pilot for Pontes by the end of the third quarter of 2026.
Alongside the announcement, the ECB has published a report with the key findings from its exploratory work on how DLT could be used for settling wholesale transactions in central bank money. [1 Jul 2025] #DLT
Hong Kong
Updates from FATF
The SFC has issued a circular to licensed corporations, licensed virtual asset service providers and associated entities regarding recent updates from the Financial Action Task Force (FATF):
- Statement on high-risk jurisdictions subject to a call for action: For all countries identified as high-risk, the FATF calls on all members and urges all jurisdictions to apply enhanced due diligence (Myanmar), and, in the most serious cases, apply countermeasures (Democratic People's Republic of Korea and Iran) to protect the international financial system from the money laundering, terrorist financing, and proliferation financing risks emanating from those countries.
- Statement on jurisdictions under increased monitoring: The FATF has added Bolivia and the Virgin Islands (UK) to, and removed Croatia, Mali and the United Republic of Tanzania from this list of jurisdictions. The FATF will closely monitor and continue to assess the progress made by the jurisdictions on this list in addressing the strategic deficiencies in their anti-money laundering and counter-financing of terrorism regimes.
- Various outcomes form the joint FATF-MONEYVAL plenary of 12-13 June 2025: These include (among others) the approval of changes to Recommendation 16 and its Interpretive Note on payment transparency, the endorsement to release an updated guidance on Recommendation 1 on financial inclusion and risk-based approach, the agreement to release a report examining complex proliferation financing and sanctions evasions schemes, the approval to publish a report on the global assessment of terrorist financing risks to date, and the agreement on the publication of the FATF's 6th Targeted Update Report.
The Insurance Authority has also a circular regarding the above FATF updates. [27 Jun 2025] #VirtualAssets
Singapore
MAS: 10th annual UK-Singapore Financial Dialogue
The Monetary Authority of Singapore (MAS) has published a summary of the discussions that took place at the 10th annual UK-Singapore Financial Dialogue. The discussions highlighted the strong and continued collaboration between the UK and Singapore, with a focus on several key themes, including. among others, digital finance and innovation.
Among the outcomes, the UK Financial Conduct Authority (FCA) and MAS agreed to deepen collaboration through joint work with the UK's Investment Association and the Investment Management Association of Singapore to explore the impact of asset tokenisation from the investor perspective and help drive greater adoption of tokenised assets in both markets.
The FCA and MAS also agreed to develop joint collaboration on AI, focusing on sharing innovative AI solutions and cross-border AI developments. [3 Jul 2025] #Tokenisation #AI
MAS releases Guardian FX workstream report on use of tokenised bank liabilities for transaction banking
MAS has released the Guardian FX workstream report which illustrates how tokenised bank liabilities, underpinned by shared ledger infrastructures, can enable 24/7 real-time settlement across borders and help optimise liquidity management in transaction banking.
The views and recommendations contained in the report those of the lead contributors and do not imply a consensus view by market stakeholders across the spectrum of international debt capital markets. [3 Jul 2025] #Tokenisation
MAS speech: Resilience and adaptability in an ever-changing fund management industry
MAS has published the keynote speech by Mr Teo Kok Ming, Executive Director (Investment Intermediaries), delivered at the Investment Management Association of Singapore's 11th Regulatory Forum. Reflecting on uncertainty in the global macro landscape, among other things, Mr Teo highlighted instances where fund managers have been targeted by cyberattacks and impersonation scammers and the lessons that can be learned from those incidents. [2 Jul 2025] #Cyber
Malaysia
SCM consults on enhancements to regulatory framework for DAX
The Securities Commission Malaysia (SCM) has published a consultation paper seeking feedback on proposed enhancements to the regulatory framework for Digital Asset Exchange (DAX). The proposals aim to enhance the competitiveness of Malaysia's regulated digital asset market, improve investor protection, and strengthen the resilience and integrity of DAX operators.
The consultation covers:
- liberalisation of the framework for listing of digital assets on DAX, subject to meeting certain minimum criteria;
- enhancing of requirements on safeguarding client assets and governance; and
- strengthening requirements for DAX operators, including the need to meet certain minimum financial criteria.
Feedback to the consultation is requested by 11 August 2025. [30 Jun 2025] #DigitalAssets
India
RBI issues directions on due diligence of ATOs
The Reserve Bank of India (RBI) has issued Reserve Bank of India [Aadhaar Enabled Payment System (AePS) – Due Diligence of AePS Touchpoint Operators] Directions, 2025.
RBI has issued draft directions on due diligence of AePS on Bank's website on July 31, 2024, for stakeholder comments. The Directions cover: due diligence requirements applicable to AePS Touchpoint Operator (ATOs) and risk Management instructions governing the activities of ATOs
The directions shall come into effect from 1 January 2026. [27 Jun 2025] #Payments
Philippines
BSP: Draft circular on protections from online gambling risks
The Bangko Sentral ng Pilipinas (BSP) has announced that it is currently reviewing
feedback on a draft circular which contains proposals that require
BSP-supervised institutions (BSIs), primarily banks and electronic
money issuers, to better protect users of their digital platforms
from online gambling risks.
The review precedes the BSP's final policy, which is intended
to strike a balance between protecting consumers and preserving
access to digital payments for licensed businesses. [3 Jul
2025] #OnlineGambling #DigitalPlatforms
Vietnam
SBV: Summary of sandbox seminar
The State Bank of Vietnam (SBV) has summarised a seminar on the implementation of arrangements regarding the implementation of a government decree (Decree 94) regulating the controlled testing mechanism – or sandbox – a in the banking sector.
Under Decree 94, there are three solutions considered to participate in the testing mechanism, including: credit scoring; data sharing via open application programming interface (open API); and peer-to-peer (P2P) lending. In the process of implementing Decree 94, the SBV will continue to review and update new products, services and business models in the banking sector to evaluate and propose to expand solutions to participate in the testing mechanism. [1 Jul 2025] #Sandbox
United States
SEC Division of Corporate Finance issues statement on cryptoasset ETP disclosures
The Division of Corporate Finance at the Securities and Exchange Commission (SEC) has issued a statement on cryptoasset exchange-traded products (ETPs). The statement reflects the Division's observations regarding disclosure practices in its reviews of cryptoasset ETP filings and addresses specific questions that market participants have presented to the staff. [1 Jul 2025] #Crypto
Treasury publishes statement on the EU-U.S. Financial Regulatory Forum
The Treasury has published the joint statement following the EU-U.S. Joint Financial Regulatory Forum which took place on 24-25 June 2025. The Forum focused on several themes, which included, among others, digital finance and payments.
The next Forum meeting is expected to take place in late 2025. [1 Jul 2025] #Payments
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