FCA Launches Quantum Group to Study Money Laundering Detection

The Financial Conduct Authority will launch a Quantum Experimentation Group in the first quarter of 2027 to test whether quantum machine learning can detect money laundering and fraud, with interest registrations closing December 31, 2026.

The FCA said on November 5 that the group is the first of its kind for a regulator. It will bring together financial services firms, quantum technology providers and national research laboratories. The move puts FCA quantum computing financial crime work on a formal footing for the first time.

For compliance teams, the group is a signal of where the regulator wants to look. Banks and other regulated firms run transaction monitoring systems to flag suspected money laundering. The FCA is now asking whether quantum approaches can do that job better than the classical models in use today.

What the FCA quantum computing financial crime group will do

The Quantum Experimentation Group will run participant-led, collaborative experiments on anti-money laundering and fraud detection. The first work will use machine learning techniques adapted for quantum computers.

The FCA will define problem statements and work alongside participants to build understanding of the opportunities, limitations and practical considerations of quantum technologies. It said the group will support organizations at different stages, from those beginning to explore use cases to those already doing advanced experimentation.

Participants stay responsible for developing and assessing their own solutions with relevant quantum specialists. The FCA’s role is to set the questions, supply the data and gather what the group learns.

The FCA said the initiative builds on its research into the long-term potential of quantum computing in financial services. It also said the group will complement wider activity across the UK’s quantum ecosystem by creating more opportunities for collaborative experimentation and learning.

Synthetic data tackles the access problem

Participants will use an FCA synthetic dataset, meaning data that is artificially generated rather than drawn from real customers. The FCA said access to suitable data is a key barrier to testing.

The regulator will provide a common dataset for developing, testing and evaluating quantum approaches. That includes comparisons with classical techniques, which is the question most compliance teams will want answered.

A shared dataset also means results from different participants can be set side by side. Firms testing on their own customer records would not produce comparable findings, and they would face data protection and confidentiality limits on sharing them.

The FCA has not said how large the dataset is, what typologies it contains or how it was built. It has not named any participating firm, vendor or laboratory.

What the group will produce for firms

The FCA said the group will help firms explore practical uses of quantum computing in financial services and share findings to guide future testing. It will also help the regulator understand the technology’s opportunities and limitations, barriers to experimentation and what these could mean for regulation.

The planned output is shared, high-level learning on performance, opportunities and limitations. The FCA said participant-specific and commercially sensitive information will be protected.

The announcement does not promise research papers, proof-of-concept systems or supervisory expectations. It also does not say how the group relates to the FCA’s existing AI initiatives or its sandbox programs.

Jessica Rusu, the FCA’s chief data, information and intelligence officer, set out the aim:

“We want to help firms explore where quantum could make a meaningful difference, and early experimentation is essential to understanding its potential in financial services. By bringing together firms, technology providers and researchers we can build readiness and identify practical applications for common industry challenges, starting with financial crime.”

Jessica Rusu, chief data, information and intelligence officer, FCA

What it means for financial crime teams

Nothing in the announcement changes a firm’s obligations under the Money Laundering Regulations 2017. The FCA said participation is not approval or endorsement of any participant, technology or solution. It also does not confirm that an approach meets regulatory requirements.

The group is a research exercise, and the FCA is explicit that it is testing a question, not endorsing an answer. Whether quantum models beat existing detection systems is what the experiments are meant to establish. A money laundering reporting officer weighing technology spend has no new evidence yet.

The design does show how the regulator is approaching emerging technology. It is fixing the data, the use case and the comparison against classical methods before any vendor claims arrive. Firms that have tuned rules and models over years will recognize the logic, which mirrors the baseline testing in transaction monitoring tuning.

The group also feeds the FCA’s own view of what quantum computing could mean for financial crime regulation. Findings could shape how supervisors think about model risk, explainability and data use if quantum tools reach production. The FCA has set no timetable for that.

How it fits the FCA’s technology work

The FCA has been building its use of data and automation. A joint survey with the Bank of England showed a surge in generative AI use across UK finance. Regulators’ own use of data tools falls under what is known as SupTech.

Machine learning is already in the market for financial crime. Vendors have been adding it to AML products, as in Hummingbird’s acquisition of Quantimon. The FCA’s quantum computing group asks a different question: whether a new class of hardware changes what such financial crime models can detect.

The FCA’s research note on quantum computing applications in financial services sets out the background to the initiative. The group moves from that research to hands-on testing.

How to register and what comes next

Financial services firms, quantum technology providers and national research laboratories can register their interest by December 31, 2026. The FCA’s page describes participants as UK organizations.

Registering does not guarantee a place. The FCA said it will share details on eligibility, the selection process and participation arrangements later.

The group launches in the first quarter of 2027. The next date to watch is December 31, 2026, when registrations close and the FCA can begin selecting participants.