The deal, announced Tuesday (April 14), is designed to complement Synctera’s offerings in compliance areas such as know your customer (KYC).
“What Cable offers sits on the other side of the equation: instead of executing compliance controls, it independently verifies that those controls are working as intended,” Synctera Co-founder and CEO Peter Hazlehurst wrote on the company blog.
“There’s no reason to be satisfied by sampling every 100th KYC to check if we followed policy. We’ll test everything.”
Cable’s solution is designed to help banks audit and test whether FinTechs and service providers are actually doing what they claim in terms of anti-money laundering (AML) policies, KYC, transaction monitoring and other compliance measures.
“We’ve also found that banks find it quite helpful for their own internal use,” Hazlehurst added.
“Cable’s product will continue to operate as a standalone offering, while also being extended to add an additional layer of compliance control on top of the Synctera Platform natively.”
Writing on her company’s blog, Cable Co-founder and CEO Natasha Vernier noted that the startup’s journey had coincided with the rise of Banking as a Service (Baas) as a way for banks to expand their revenue streams and reach new markets.
“Banks look to BaaS providers like Synctera to help them grow,” she wrote. “Cable being a part of Synctera means that even more banks will benefit from automating the hardest parts of their work.”
In related news, PYMNTS wrote recently about new proposed AML rules for federal banking regulators, arguing that they offer a “clear path for how compliance will be expected to operate as financial services continue to digitize and expand across platforms.”
The rulemaking retains the central requirement that banks create and maintain programs for AML and to counter terror financing, while redefining how those programs are evaluated.
A deeper reading of the proposed rulemaking, PYMNTS said, shows that the traditional structure of AML programs remains in place. Banks must keep internal controls, independent testing, a designated compliance officer and continual training.
“What seems on a glide path for change is how those components must operate,” the report added. “Internal controls must be risk-based and ‘reasonably designed’ to identify, assess and mitigate risks tied to customers, products and geographies.”