Regulatory technology services: FTS

The digital revolution in finance and banking has a downside: it can provide criminals and terrorists with instant getaways for money, as proceeds can traverse oceans within milliseconds. Financial Transparency Solutions is helping central banks and financial supervisors to address these risks.

Notably, FTS’s Strix anti-money laundering technology was selected by the Central Bank of Oman to automate its collection of bi-annual AML and countering the financing of terrorism returns from regulated entities.

Zainab Al Lawati, manager of the AML/CFT department at the Central Bank of Oman, says that as the risks “evolved” and the central bank collected more AML/CFT information and data, its analysis became more sophisticated – but it also became increasingly difficult to continue with manual methods. The implementation of Strix has streamlined the data collection process, thereby facilitating more effective risk assessment across the supervised sectors of banking, finance and leasing, payment and remittance, and money exchange. Additionally, the analysis of information related to virtual assets has been enhanced through this system.

The digitisation efforts at the Central Bank of Oman forms parts of its overall strategy to build a vibrant digital ecosystem, founded on cutting-edge infrastructure and technology. Not only did FTS’s Strix support the central bank in advancing its goals, but it also exceeded expectations, by helping to identify risk areas, which were difficult to plug due to limitations in manual data processing.

Al Lawati notes Strix has been effective in identifying risks “even within smaller and low-risk entities”. The central bank could identify that one of its low-risk entities was contributing to key risks in the sector. The central bank also learned that risk contamination in a network can act in a non-linear way: a low-risk entity was involved with a high-risk correspondent banking business in the sector.

FTS has used machine learning and feedback loops to improve its regtech and suptech services for several years. Strix uses dynamic weighting to adjust the importance of different activities in the system based on the data received, FTS founder and managing director, Garrett Dunker, tells Central Banking. This feature has the result that risk models automatically tailor to individual business models used by obliged entities.

The nationality of beneficial owners under “Risks relating to ownership and management of FI” risk is another data point that now is automatically embedded in the regtech and suptech system. Previously, whenever officials noticed there was a high-risk element in ownership, they would modify this manually as an override for individual entities. Now, the data is more complete, and supervisors noticed that, unexpectedly, the risk profiles of several entities shifted higher.

Yet another way in which the Central Bank of Oman’s sectoral risk analysis was enhanced by using Strix was to design customised and automated dashboards for each risk category the bank uses as part of its sectorial risk assessment. Upgrades, Al Lawati says, have happened as quickly as within 22 days.

Financial authorities from other nations have also reached out with requests for details about the Central Bank of Oman’s survey criteria and model used to assess the data provided by regulated entities. Further, Oman’s adoption and feedback have also led to new features being developed and integrated into the Strix tool, says Dunker.

As well as the Central Bank of Oman, FTS works with 13 other regulators worldwide, including in the Cayman Islands, Isle of Man, Luxembourg, Monaco and the United Arab Emirates, covering submissions from more than 20,000 entities. Strix supports multiple languages, allowing for localised surveys and assessments.

Strix was designed to facilitate collaboration, making it easier for supervisors to share and import models, says Dunker. He adds that knowledge-sharing has occurred between Monaco and the Luxembourg Bar, the Isle of Man and Lithuania, and Oman and Portugal, among a few other shares.

The scope of project work at the Central Bank of Oman included onboarding of Strix and security testing, business and IT team training, survey subject-matter enhancements, and first-year technical assistance to ensure successful use of the service.

When Strix AML was onboarded in 2023, five years of historical data were uploaded and three sequential bi-annual reporting cycles of AML/CFT risk assessments were performed for each sector. This created a baseline from which to measure the effectiveness of a risk-based approach to these sectors.

As part of the digitalisation objectives, Strix AML was also used to improve the ease of creating and conducting surveys; the volume and quality of data collected to include more geographic breakdowns; to simplify the process of resubmissions and corrections; to reduce the duration of time necessary to collect data; and to reduce processing time to perform institutional risk assessments.

As a result of the new capabilities and enhanced surveys, the Central Bank of Oman has collected more data with more relevance and accuracy, thereby enabling a more precise understanding of AML/CFT risk in the jurisdiction, from international activity.

The efforts by the central bank and FTS appear to be paying off. “Oman has put in place a well-resourced AML/CFT supervision framework,” said the Financial Action Task Force said in a mutual evaluation report published in December 2024.

The Central Banking Awards 2025 were written by Christopher Jeffery, Daniel Hinge, Daniel Blackburn, Joasia Popowicz, Riley Steward, Jimmy Choi, Levente Koroes, Thomas Chow and Blake Evans-Pritchard.