Legacy tech will become barrier to fighting financial crime – survey
More than 90% of senior financial crime professionals working in the UK banking industry are worried that their firms' legacy technology will become a barrier to fighting crooks over the next couple of years.
Fighting Financial Crime: Fraud
Could you tell the difference between an accurate document and a truthful one? HSBC wants to play a leading role in the fight against abuse of the financial system, and this film is part of a series designed to educate HSBC employees about the risks of financial crime. Noel Quinn, our Chief Executive of Global Commercial Banking, meets a reformed criminal to find out about techniques used by fraudsters to mislead banks and investors.
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Warhammer Combat Cards Secondary Traits Review Part 1 (Aeldari through Servants of the Emperor)
My hot takes of every single Secondary Trait added to Epic and Legendary cards in November of 2022, Part 1.
I went through every Epic and Legendary bodyguard first, then warlord, faction by faction. You’ll see all of the traits, get some commentary and hot takes on the new abilities, how they interact, and what decks are impacted and how.
Part 2 can be found here: https://youtu.be/VQ725SSJhzg
It is time to stop wasting money on a failed and broken approach to defeating financial crime
ℹ️ For more information, go to: https://futureoffinance.biz/2022/01/03/it-is-time-to-stop-wasting-money-on-a-failed-and-broken-approach-to-defeating-financial-crime/
Listen to the podcast: https://shows.acast.com/611d14fa9d5f470014bbc7b3/episodes/it-is-time-to-stop-wasting-money-on-a-failed-and-broken-appr
Subscribe for more content like this: https://www.youtube.com/channel/UCTBnon9ha_T8kH-_GxCPYXA?sub_confirmation=1
The costs of financial crime are staggeringly high. The financial crime compliance officers that responded to a LexisNexis Risk Solutions survey of financial institutions in 26 markets around the world said they spent US$213.9 billion on compliance with financial crime regulations in 2020. If the main finding of a Refinitiv survey of 19 markets in 2018 still holds, and firms are spending 3.1 per cent of annual turnover on Know Your Client (KYC), Anti Money Laundering (AML), Countering the Financing of Terrorism (CFT) and sanctions screening measures, the expenditure is much higher than that figure suggests: US$1.28 trillion, in fact. Despite such vast expenditures, compliance breaches do occur, and regulatory fines ensue. According to the Kroll Enforcement Survey, between 2016 and the first half of 2021, financial institutions paid 338 regulatory fines for money laundering, sanctions breaches and bribery that totalled almost US$26 billion. These fines can be surprisingly chunky. HSBC paid US$1.92 billion in 2013 and ING US$900 million in 2018. Then there is the cost of the financial crime itself. This is much harder to estimate, but the Refinitiv survey put it at 3.5 per cent of the turnover of its respondents, or US$1.45 trillion. And this is the true absurdity: the cost of financial crime compliance (US$1.28 trillion) is now almost as expensive as financial crime itself (US$1.45 trillion). That is the reductio ad absurdum of half a century of regulatory pressure on money launderers, terrorists and other financial criminals. Since the United States passed the Bank Secrecy Act in 1970 to discourage money laundering through secret bank accounts, the financial services industry has assumed a steadily mounting burden of compliance obligations.
Among the topics to be discussed at this webinar are:
What are the costs of (a) financial crime compliance (b) financial crime non-compliance and (c) financial crime?
What are the causes of the cost of financial crime compliance?
How large a proportion of the costs of financial crime compliance are attributable to customer due diligence?
How large a proportion of the costs of financial crime compliance are attributable to the volume and complexity of financial crime regulations?
To what extent has financial crime compliance become merely a corporate insurance policy?
Are the goals of regulators (laws, regulations and fines) and regulated (profit seeking, cost controlling) fundamentally at odds in the field of financial crime?
To what extent do other regulatory initiatives (Faster Payments, Open Banking, Open Finance, customer confidentiality, e. g. GDPR) make financial crime compliance harder?
To what extent do customer demands (faster transactions, faster on-boarding) make financial crime harder to detect?
Established financial institutions are burdened with legacy systems, legacy processes and siloed customer databases in multiple formats. Can these obstacles be overcome at reasonable cost?
Public databases are often incompatible, incomplete and inaccessible. What responsibility do public authorities have for improving data quality?
What can established financial institutions learn from challenger banks and FinTechs?
Has the use of technology so far (e. g. eIDV, eKYC, biometrics) made a material difference?
Is hiring more people effective?
What improvements have artificial intelligence (AI) and machine learning (ML) delivered?
Are financial services firms too busy complying to innovate?
Should financial services firms be more willing to share data with each other?
Can investing in data, technology and better processes actually cut the cost of financial crime compliance?
Why are financial services firms sceptical of digital identity?
What responsibility do public authorities have for encouraging adoption of digital identities?
Do regulated firms see the links between digital identity and Open Banking, Open Finance and Open Data?
CEO and co-founder of Secretarium
Rayissa Manning Armata
Head of Regulatory Affairs at IDnow
Head of Financial Crime in the Business Solutions Group
Independent IT Advisor
Moderated By: Dominic Hobson Co-Founder at Future of Finance
Deploying AI in the fight against financial crime in the banking industry
Criminal attacks on banks are staggering in scale and relentless in pace. From credit card fraud to money laundering to account takeovers and insider fraud, financial criminals relentlessly devise new attacks that all too often slip past banks’ defenses undetected. Despite the best efforts of skilled teams focused on the problems, financial crimes remain a major ongoing cost to businesses in banking.
Analytic techniques leveraging artificial intelligence can result in dramatic improvements in crime detection and interdiction across diverse attack modalities. Simon Moss and Ben MacKenzie share AI models and operational techniques they’ve used with major banking clients to substantially strengthen and accelerate their responses to criminal attacks.
• Effective applications of AI to thwarting financial crime in the banking industry
• Necessary considerations to keep AI models compliant with relevant regulations
Approaches to integrating AI models with legacy analytics and rules platforms
Director, Western Region Services