Senior English Judge Comments on FinTech

By Jonathan Lawrence

In a recent speech, one of England’s most senior judges explored, in the context of the digital revolution, the culture of and relationship between the UK financial services sector, the UK legal profession, and the judiciary in a changing technological environment. Sir Geoffrey Vos, Chancellor of the High Court, gave the Banking Standards Board Lecture on 20 March.

Some highlights:

  • “It is already apparent that there is considerable scope for fraud in the brave new world of fintech, smart contracts and artificial intelligence, to say nothing of cyber-crime, hackers and cyber-blagging. Credit card and online banking scams are just the start. This context may make the frauds of yesteryear look modest.”
  • “There are opportunities here for English law and UK jurisdiction to offer the legal foundation for both digital ledger technology and smart contracts, using the inherent flexibility of the common law, based as it is, not on a statutory code, but on a set of principles that can be applied to any developing commercial situation.”
  • “There will, I think, also be an inevitably rather enhanced risk of fraud if we move headlong towards the use of permission-less digital ledger technology – towards the use of public blockchains for financial transactions….  So far, crypto-currencies have used permission-less DLT… An answer may be the greater use of permissioned digital ledger networks, with which some of the banks are now experimenting. But even such systems are unlikely to be invincible.”
  • “What emerges from what I have said is, I think, the realisation that legal and financial services already transcend national boundaries. This trend is likely to increase dramatically with the growth of fintech, legal tech and artificial intelligence generally. Indeed, as I have said, judges themselves are already being recruited internationally.”

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