Navigating through the dark system
04 Sep 2024
Jack McRae speaks to Rory Doyle, head of Financial Crime Policy at Fenergo, on his time fighting financial crime for over two decades, and why he is hopeful for the future
Image: kras99/stock.adobe.com
For four years, Rory Doyle studied archaeology at university and learnt the skills that would lay the foundations for his future career. Offering the grounding for research, verification and document trawling skills, archaeology allowed Doyle to kickstart his career.
The trouble with archaeology, however, is that Doyle did not know what he wanted to do with his degree. Like thousands have done before him, Doyle turned to the university careers officer who offered him a business and marketing post-graduate course.
“From there, there was work experience in the compliance department of a company stock brokers. I kind of fell into it, but then found a niche in financial crime and I’ve been there ever since,” Doyle explains. Almost 30 years on from that chat with the careers officer, Doyle has been working in the financial services industry ever since and has made it his mission to fight financial crime.
Since falling into the industry, Doyle has carved out his own path and is now head of Financial Crime Policy at Fenergo. He says casually about a decision that came to establish his career, “I suppose it was just a niche and you’re actually fighting the good fight. You’re preventing nefarious people from abusing firms that you work for and those you have built up relationships with”.
Since beginning in the industry, Doyle has seen operations change. He remembers: “when I started in asset servicing with J.P. Morgan in 2008, the industry was a very paper-based system, utilising spreadsheets and Microsoft to access everything. But during that period we discovered the risk-based approach.
“We have gone from simple spreadsheets and simple tick boxes on paper, to algorithms looking at transactions, jurisdictions, ownerships and cutting out all the noise.”
Revealing the true scale
It is perhaps fortunate that the industry has developed beyond the time where those combating financial crime would use those simple spreadsheets and tick boxes to track criminals. The scale of money laundering within the asset servicing sector is emphasised by Doyle who details how, “money laundering was estimated to be a US$3 trillion industry in 2023. That would put it in the top five industries in the world. It just shows the amount of capital that can be invested into circumventing the rules and utilising asset services as a conduit for money laundering.”
The expansion of anti-money laundering (AML) operations globally has revealed how widespread financial crime is, even in the last few years. Doyle points to how, in 2018, the number of countries on the Financial Action Task Force’s (FATF) grey-list for money laundering was “around the 11 mark”, this has “increased to 28 jurisdictions currently.”
This is not necessarily a negative, Doyle claims. He is optimistic that the growing number of jurisdictions placed on the grey-list represents the success of AML efforts globally, rather than an increased level of crime.
He hopes that “there’s been an increase in the amount of financial crime being identified by financial institutions utilising new technologies. That is what is causing the increase in the amount of suspicious activity reporting. It can just as easily be [considered] a success, as opposed to a failure on the part of the jurisdiction. Now we just see how much money is going through the ‘dark system’.”
Doyle continues to speak with pride at the industry’s willingness to tackle financial crime head on. “We’re seeing such a growth of understanding of how to identify money launderers and people involved in or entities involved in terrorist financing within the asset servicing sector,” Doyle says. “We have such a huge amount of uptake from our clients wanting to understand how best to interpret these guidelines and how to utilise them to their best efforts to identify financial crime.”
A better place
Despite having worked in AML for decades, Doyle still enjoys his work every day. He explains how he is able to maintain this interest because “criminality is never going to go away and every day is different. There are 126 jurisdictions my team is looking at which all have their own AML rules.”
Not only does the ever-changing nature of AML keep Doyle enamoured, but unlike other areas within the financial industry, Doyle believes he is able to make a positive difference and feels rewarded in his work.
He explains: “When we’re screening individuals, around 99.99 per cent are transparent and good actors. But, when you get those occasions where you’ve actually contributed to finding somebody who’s trying to commit a crime, and you can contribute to making the world a better place, that’s where it is most rewarding.”
Doyle is also keen to help reduce the number of jurisdictions on the FATF grey-list. Being placed on the list comes at “huge cost to an economy,” Doyle states, and continues to argue that by getting — and staying — off the list, it can open up money that “could be used to help educate people, to help feed people, to make the world better. The way to do that is to not only get these jurisdictions off the grey list as quickly as possible, but ensure that we can provide an economical system or their financial institutions to be in line with global standards.”
He highlights the Cayman Islands as a key example of how jurisdictions have to, and can, change their fortunes. The Caribbean island was placed on the FATF grey list and “are now off because they instigated a great programme of change and made sure that their system was up to standard.”
The future of AML
As the world continues to wake up to the extent of money laundering in the asset servicing industry, AML operation growth continues to accelerate.
“We’re seeing globally a large increase in the number of firms — and not just asset servicing firms — that are classified as regulated financial institutions,” Doyle describes. “There are new fintechs, regtechs, payment service providers, banks, asset servicers, asset managers, investment managers and these all have to have a client due diligence and transaction monitoring process, which means they need to have a financial crime team, they need to have a screening team, they need to have an ongoing monitoring team.”
But, are there enough experts available to match the demand of combating financial crime?
Doyle’s response is direct: “There is a dearth of qualified financial crime professionals globally and asset service providers need to utilise the resources they have more efficiently to be able to keep up with the new trends.”
The rewarding draw of tackling financial crime is often overshadowed by better paid roles within the sector. Doyle laments how even though, “financial crime is a very well paid job, in comparison to other jobs in financial institutions, it wouldn’t be the most rewarding economically. That is upsetting to see so much talent go towards other areas of financial institutions and the financial system compared to financial crime.”
However, this does not deter Doyle’s efforts and he is using his expertise in fighting financial crime to help develop the next generation. “I’m looking to use my knowledge to offer thought leadership and to educate the new workforces coming in. I actually do some lecturing with the university in Dublin to provide AML courses.”
During his lecture, Doyle has taken heart from the appetite for AML from the younger people that the industry will turn to one day to carry the baton in fighting financial crime. “I’ve seen a big take up in the amount of people who want to [study AML],” he explains.
Doyle is hopeful that returning to the academic sector where he left with a degree in archaeology can too help steer those students seeking career officers’ advice towards a career in fighting financial crime.
The trouble with archaeology, however, is that Doyle did not know what he wanted to do with his degree. Like thousands have done before him, Doyle turned to the university careers officer who offered him a business and marketing post-graduate course.
“From there, there was work experience in the compliance department of a company stock brokers. I kind of fell into it, but then found a niche in financial crime and I’ve been there ever since,” Doyle explains. Almost 30 years on from that chat with the careers officer, Doyle has been working in the financial services industry ever since and has made it his mission to fight financial crime.
Since falling into the industry, Doyle has carved out his own path and is now head of Financial Crime Policy at Fenergo. He says casually about a decision that came to establish his career, “I suppose it was just a niche and you’re actually fighting the good fight. You’re preventing nefarious people from abusing firms that you work for and those you have built up relationships with”.
Since beginning in the industry, Doyle has seen operations change. He remembers: “when I started in asset servicing with J.P. Morgan in 2008, the industry was a very paper-based system, utilising spreadsheets and Microsoft to access everything. But during that period we discovered the risk-based approach.
“We have gone from simple spreadsheets and simple tick boxes on paper, to algorithms looking at transactions, jurisdictions, ownerships and cutting out all the noise.”
Revealing the true scale
It is perhaps fortunate that the industry has developed beyond the time where those combating financial crime would use those simple spreadsheets and tick boxes to track criminals. The scale of money laundering within the asset servicing sector is emphasised by Doyle who details how, “money laundering was estimated to be a US$3 trillion industry in 2023. That would put it in the top five industries in the world. It just shows the amount of capital that can be invested into circumventing the rules and utilising asset services as a conduit for money laundering.”
The expansion of anti-money laundering (AML) operations globally has revealed how widespread financial crime is, even in the last few years. Doyle points to how, in 2018, the number of countries on the Financial Action Task Force’s (FATF) grey-list for money laundering was “around the 11 mark”, this has “increased to 28 jurisdictions currently.”
This is not necessarily a negative, Doyle claims. He is optimistic that the growing number of jurisdictions placed on the grey-list represents the success of AML efforts globally, rather than an increased level of crime.
He hopes that “there’s been an increase in the amount of financial crime being identified by financial institutions utilising new technologies. That is what is causing the increase in the amount of suspicious activity reporting. It can just as easily be [considered] a success, as opposed to a failure on the part of the jurisdiction. Now we just see how much money is going through the ‘dark system’.”
Doyle continues to speak with pride at the industry’s willingness to tackle financial crime head on. “We’re seeing such a growth of understanding of how to identify money launderers and people involved in or entities involved in terrorist financing within the asset servicing sector,” Doyle says. “We have such a huge amount of uptake from our clients wanting to understand how best to interpret these guidelines and how to utilise them to their best efforts to identify financial crime.”
A better place
Despite having worked in AML for decades, Doyle still enjoys his work every day. He explains how he is able to maintain this interest because “criminality is never going to go away and every day is different. There are 126 jurisdictions my team is looking at which all have their own AML rules.”
Not only does the ever-changing nature of AML keep Doyle enamoured, but unlike other areas within the financial industry, Doyle believes he is able to make a positive difference and feels rewarded in his work.
He explains: “When we’re screening individuals, around 99.99 per cent are transparent and good actors. But, when you get those occasions where you’ve actually contributed to finding somebody who’s trying to commit a crime, and you can contribute to making the world a better place, that’s where it is most rewarding.”
Doyle is also keen to help reduce the number of jurisdictions on the FATF grey-list. Being placed on the list comes at “huge cost to an economy,” Doyle states, and continues to argue that by getting — and staying — off the list, it can open up money that “could be used to help educate people, to help feed people, to make the world better. The way to do that is to not only get these jurisdictions off the grey list as quickly as possible, but ensure that we can provide an economical system or their financial institutions to be in line with global standards.”
He highlights the Cayman Islands as a key example of how jurisdictions have to, and can, change their fortunes. The Caribbean island was placed on the FATF grey list and “are now off because they instigated a great programme of change and made sure that their system was up to standard.”
The future of AML
As the world continues to wake up to the extent of money laundering in the asset servicing industry, AML operation growth continues to accelerate.
“We’re seeing globally a large increase in the number of firms — and not just asset servicing firms — that are classified as regulated financial institutions,” Doyle describes. “There are new fintechs, regtechs, payment service providers, banks, asset servicers, asset managers, investment managers and these all have to have a client due diligence and transaction monitoring process, which means they need to have a financial crime team, they need to have a screening team, they need to have an ongoing monitoring team.”
But, are there enough experts available to match the demand of combating financial crime?
Doyle’s response is direct: “There is a dearth of qualified financial crime professionals globally and asset service providers need to utilise the resources they have more efficiently to be able to keep up with the new trends.”
The rewarding draw of tackling financial crime is often overshadowed by better paid roles within the sector. Doyle laments how even though, “financial crime is a very well paid job, in comparison to other jobs in financial institutions, it wouldn’t be the most rewarding economically. That is upsetting to see so much talent go towards other areas of financial institutions and the financial system compared to financial crime.”
However, this does not deter Doyle’s efforts and he is using his expertise in fighting financial crime to help develop the next generation. “I’m looking to use my knowledge to offer thought leadership and to educate the new workforces coming in. I actually do some lecturing with the university in Dublin to provide AML courses.”
During his lecture, Doyle has taken heart from the appetite for AML from the younger people that the industry will turn to one day to carry the baton in fighting financial crime. “I’ve seen a big take up in the amount of people who want to [study AML],” he explains.
Doyle is hopeful that returning to the academic sector where he left with a degree in archaeology can too help steer those students seeking career officers’ advice towards a career in fighting financial crime.
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