of profit is tolerated, or even condoned. the “ bad apple ” theory acts as an excuse for not doing the hard work of cultural reform. in this process of blaming bad apples, leaders fail to look at what ’ s happening to the rest of the barrel. what kind of environment has let the rot set in? understanding the full complexity of what forms a culture is important, but our unique position within the financial system means the federal reserve bank of new york must do more. our role in achieving progress three principles — “ connect, ” “ convene, ” and “ catalyze ” — guide my thinking in this area. connecting people with the latest data and research — and sharing experiences — gives them the insights and tools they need to make change. conferences like this one are critical — as is our online research hub, which acts as a clearing house for the latest information and initiatives from a wide range of organizations. but, that ’ s not enough. in this regard, we recently announced the education and industry forum on financial services culture to support these efforts. the forum, which kicked off in april, brings together business schools and industry representatives. participants will research and design case studies for business school students. this will mean that students planning to enter the industry will have the tools to handle the ethical challenges that can arise in real - life work situations. 2 / 3 bis central bankers'speeches “ convene ” means bringing together stakeholders to share best practices. and that ’ s where our supervisors roundtable comes in. the roundtable brings together supervisors from around the world to share their jurisdictions ’ approach and what they ’ ve learned from it. participants have developed a shared set of tools for supervisors that can be leveraged in cultural assessments. finally, let me turn to this principle of “ catalyze, ” and how we can use our position in the heart of the financial district, to create change. as well as talking the talk — we ’ re walking the walk. this year, for the first time, this bank is taking the banking standards board ( bsb ) assessment. the bsb assessment measures the extent to which nine characteristics are demonstrated by an organization, and it includes things like honesty, accountability, and respect. the assessment started in the uk, and the irish banking culture board now takes a similar approach. i would love to see firms in the united states adopt an industrywide survey that can measure culture and benchmark banks against their peers. data gathering is

banks and other financial institutions to safeguard the payment system. our laws and regulations increasingly bring the industry into partnership with the government on combatting national security risks to the united states and financial crime. anti - money laundering is not just a matter of historical record. our rules continue to evolve. for example, in 2016 the treasury department updated its regulations to require that banks and other financial institutions verify the identity of the natural persons — that is, the “ beneficial owners ” — who own or control companies that hold accounts. 4 the beneficial owner rule, like other “ know your customer ” rules, is a regulatory floor, not a ceiling. covered firms can take the initiative to implement more stringent internal rules based on their risk. indeed, in december 2018, the federal banking agencies published guidance that encouraged innovation in anti - money laundering compliance — pilot programs that exceed the legal minima, or at least make compliance more efficient. 5 experiments in ratcheting up internal thresholds are welcome. as i have said in other contexts, one challenge in a rules - based regime is that the pace of rulemaking is not always commensurate with the pace of rule breaking. 6 complying with minimum legal thresholds may not be sufficient in all circumstances to appropriately mitigate risk to your firm or the payment system. 7 technology has greatly expanded access to the payment system. many of us — everyday consumers, that is — effect payments not only directly through our banks, but also through various “ fintech ” intermediaries. there is much good in this, but technology is not riskfree. the creative development and application of technology can create opportunities to improve the payment system. technology also creates new opportunities to compromise that system. take, for example, the nascent challenge presented by the development of digital currencies. the new york state attorney general ’ s office estimates that more than 1, 800 virtual currencies are exchanged around the world. 8 many digital currencies use distributed ledger technologies, which can help institutions achieve efficiencies in customer due diligence programs. distributed ledgers also promote traceability, which in theory assists law enforcement. that said, the use of private exchanges for these digital currencies may facilitate anonymity, which tends to help the bad guys. my concerns, however, are less about the technological frontier, and more about well - established risks to the payment system. recent press reports about financial crimes involving 1mdb, danske bank, swed