On February 1, 2022, the Federal Deposit Insurance Corporation (“FDIC”) and the Financial Crimes Enforcement Network (“FinCEN”) opened registration for their “Digital Identity Tech Sprint,” with a focus on digital identity proofing. Registration will close on February 15, 2022 at 5 p.m.
As the FDIC and FinCEN recognize, digital technology plays an important role in both remotely delivered financial services and related compliance activities, from customer onboarding and identification to customer due diligence and risk management.
Digital identity proofing – the process used to collect, validate and verify information about a person – is essential to ensuring digital financial services function properly and safely. While the regulators recognize the promise of dynamic identity evidence and behavioral analytics, among other technological developments, they also cite challenges to digital identity proofing that include the proliferation of compromised identifying information and increasing use of synthetic identities. As the FDIC and FinCEN assess and calibrate the risks associated with digital identity proofing, they seek approaches to measuring the effectiveness of digital proofing methods. Accordingly, the upcoming Tech Sprint is aimed at answering the following question: “What is a scalable, cost-efficient, risk-based solution to measure the effectiveness of digital identity proofing to ensure that individuals who remotely (i.e., not in person) present themselves for financial activities are who they claim to be?”
Companies that register and are chosen to participate will work together in teams to develop solutions over a three-week period, culminating in a “Demonstration Day” for team presentations. The Tech Sprint offers companies an opportunity to showcase their work on measuring the effectiveness of digital identity proofing, as well as to encourage the FDIC, FinCEN and other policy makers to continue working collaboratively with the private sector as they pursue the critical task of modernizing the U.S. anti-money laundering regulatory framework.
Additional information on the Tech Sprint and links to the prize notice and FAQs are available here. Please do not hesitate to contact us with any questions.
Questions can be emailed to the Debevoise Fintech team at debevoisefintechblog@debevoise.com.
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