Reusable ID for AML acquired by global fintech as compliance costs rise

Global fintech platform iCapital has entered a definitive agreement to acquire U.S.-based Parallel Markets, which provides reusable identity tools for investor onboarding, verification and monitoring.

In a company release, Lawrence Calcano, chairman and CEO of iCapital, says “onboarding and verifying digital investor identity and compliance is a major friction point in private markets investing. Parallel Markets has pioneered software that supports a reusable investor passport, streamlining these duplicative processes for advisors, investors, and fund managers.”

The reusable KYC/AML passport technology for alternative investments aims to be a “turnkey onboarding solution,” creating a universal reusable identity for the investor that can be used across iCapital Marketplace.

The ID will function as a “data locker for storing, managing, and sharing personal information needed for fund subscription and compliance verification in private markets.” It is intended to simplify KYC/KYB processes, make scaling smoother and ensure consistency in compliance with AML standards.

“As we continue to evolve our tech stack, we will enhance automated entry for alternative investing and leverage AI and machine learning to offer a complete, intuitive end-to-end solution. This is expected to result in faster onboarding, reduced costs, and a more efficient investment process.”

For Parallel Markets, the acquisition refines its focus and purpose. “As of today, we have focused on fund managers and the broader private wealth channel which is an increasingly important focus for leading financial institutions,” says Tony Peccatiello, CEO of Parallel Markets, who will be joining iCapital as part of the acquisition.

Terms of the agreement were not disclosed.

Block hit with $80M fine for AML compliance violations

Oakland-based Block Inc., which owns the mobile payment platform, Cash App, has agreed to pay a fine of $80 million to a coalition of 48 state financial regulators who deemed the company’s AML measures to be insufficient.

Reuters reports that the Conference of State Bank Supervisors announced the settlement, which would also compel the fintech firm to hire an independent consultant to review its Bank Secrecy Act and AML program.

A spokesperson for Block Inc. says the firm, which has waded into mobile driver’s licenses (mDLs) and decentralized ID, “will continue to invest across our operations to help promote a safe and healthy fintech ecosystem.”

$22 million to boost Quantifind’s AI platform

Following a year that saw it grow by 200 percent, Quantifind has raised $22 million in funding from Deloitte Ventures and Stephens Group as well as existing investors, Citi Ventures, S&P Global, DNS Capital, and USVP, per a news release.

The investment will accelerate the global expansion of Quantifind’s flagship platform, Graphyte, and power the launch of its Payments Risk Intelligence product for AI-powered financial crime intelligence.

“AI has become the weapon of choice for fraudulent and criminal actors within the financial services ecosystem,” says Ryan Morrow, managing director at Stephens Group. “Our investment in Quantifind reflects our belief that Quantifind’s AI Graphyte technology tips the balance back in favor of bank compliance and law enforcement.”

Ari Tuchman, CEO of Quantifind, says its biometric transaction screening for payments performs contextual analysis of counterparty relationships, offering the accuracy of large language models with the speed of real-time machine learning.

Technological advancements to Graphyte’s machine learning operations address “the dynamic and high-stakes nature of transaction and name screening,” maximizing signals from metadata and hidden features, and separating feature discovery from runtime decisions to optimize speed and scale.

Article Topics

AML  |  biometrics  |  Block  |  digital identity  |  financial services  |  fraud prevention  |  identity verification  |  Quantifind  |  reusable identity