One of the world's largest financial crime watchdogs is looking to fight fire with fire amid a global battle against cyber crime.

The president of a financial crime watchdog has said that it wants to use fintech to tackle money laundering, as the regulator looks to harden its stance on global compliance issues.

Juan Manuel Vega-Serrano, president of the Financial Action Task Force, a Paris-based international body that sets standards on anti-money laundering and counter-terrorism finance compliance, was interviewed by the Risk and Compliance Journal on his views about the latest developments in the compliance sector.

He said the FATF is “engaging with the fintech community in order to make our policies effective in the new landscape”, and “has reached out to the fintech community to join forces and foster innovation that is resilient against terrorism financing and money laundering”.

The FATF held a session with companies in the fintech and regulation technology sectors in San Jose, California last month. The session finished with an agreement of the San Jose principles. The agreement seeks to establish future dialogue with the body and fintech companies, including talks around cyber crime. Vega-Serrano was asked about the dangers of criminals making use of fintech and what the FATF was doing to counteract these possibilities.

“I can’t give a single answer, because it depends on the product. The main risk is the new products in development that don’t take into account anti-money-laundering risk,” he said. “I tend to be optimistic: If we get it right, it’ll get us a more-effective anti-money laundering and counter-terrorism financing policy. But that is conditional on the fintech community taking risks into account.”

Interest in fintech has skyrocketed in recent years, as firms have increasingly invested into the burgeoning sector to attract tech-savvy clients and to streamline internal processes. Vega-Serrano was also asked whether regulators have eased their fears on fintech.

”There is a significant change in the attitude among a number of regulators,” Vega-Serrano admitted. “We see the risk, but we think the risks can be properly addressed and mitigated if properly handled.

“There is an understanding that fintech can be a significant contribution to a more effective anti-money laundering and counter-terrorism-finance policy. If we strike the balance right, and we engage the industry and the industry designs its products correctly that takes it into account, we will have a much more effective policy against terrorism financing. That’s why the FATF is so focused on building this partnership and engagement with the industry."