4  BIS central bankers’ speeches  Result – Relationship between threats and vulnerabilities Based on the analysis and methodologies employed, our assessment concluded that there are 5 types of crimes that pose high money laundering risk threat to the country. Those crimes are: •  Fraud (which comprises fraud-related offences, for example cheating offences under the Penal Code, illegal investments schemes offences under the Financial Services Act, Capital Market and Services Act, Direct Sales and Anti-Pyramid Scheme Act, and Companies Act),  •  Drugs trafficking,  •  Corruption and bribery,  •  Smuggling offences (including evasion of customs and excise duties), and  •  Tax crimes. Based on data from LEAs, except for corruption and bribery, the number of investigation conducted and the amount involved in the investigation on these types of crimes are high. This finding is in line with the results of perception survey and feedback from other LEAs. It also conforms to various credible independent international and external reports. In terms of vulnerability to money laundering and terrorist financing risks, sectors that are most vulnerable and attractive to money laundering and terrorist financing risks are the banking and money services business in the financial sector and casino in the non-financial sector. Key factors contributing to the vulnerabilities of these sectors are size of their institutions, high volume of transactions, high exposures to cash-based transactions, high geographical coverage, multiple channels of deliveries, and high exposures to cross-border transactions.
Third, the disruptive possibilities of the fintech revolution are beginning to touch the core of the financial sector. Now it is time for a similar transformation of the diversity of one of the most important sectors of the UK economy. In many respects, Jayne-Anne Gadhia’s report is long overdue. For too long the representation of women in middle and senior tiers of management has lagged that in other leading sectors. For too long, results have fallen short of good intentions. And for too long the financial sector has suffered the economic consequences of this inequality while society has borne the broader costs. Greater diversity – in all its forms, cognitive, gender, background, ethnicity, religion – can help transform the financial sector. Research has shown that companies with a significant proportion of women in senior management positions perform better in part because of some leadership behaviours that women exhibit more consistently than their male colleagues. 1 In particular, women are found to excel at people development, participative decision making, presenting a compelling vision and acting as role models – all drivers of financial performance. 2  1  http://www.mckinsey.com/business-functions/organization/our-insights/why-diversity-matters. 2  https://hbr.org/2012/03/a-study-in-leadership-women-do. BIS central bankers’ speeches  1  Research on board membership has also shown that female directors enhance board independence, partly because women bring different perspectives and networks to the table, and partly because they are more likely to ask difficult questions.