Elevating Your Financial Crime Fighting In A Post-COVID-19 Era
Financial Crime Mitigation in a New Era
We are living in increasingly anxious times. From routine, humdrum lives, Mother Nature rapidly catapulted us into a disruption, the scale of which only she can achieve. As everything was re-aligned, we had to adapt to wildly different working patterns, shopping habits, disruption of our socializing, and disturbed sleep as we were held prisoner-like at home. And as we re-adjusted to new ways of working, so did the online criminals.
The new era has triggered a jump in financial crimes. Fraud alone costs the banking industry approximately $67bn annually, requiring banks to improve their financial crime mitigation (FCM). However, as the criminals have changed their tactics, new technology is coming online to help alleviate the complexities of implementing and running systems that combat such violations. FCM Software-as-a-Service (SaaS) on the cloud now allows banks to consume, experience, and manage FCM in a more secure, continually evolving platform.
A new e-book from Temenos and Microsoft, Elevating Your Financial Crime Mitigation Solution, shows how you can reduce costs and increase your FCM strategy’s effectiveness.
Money-laundering and Non-Compliance
According to the United Nations, an estimated $1.6 trillion is laundered globally through banks each year for criminal enterprises and terrorist activities. And it’s not just crime-fighting resources banks have to invest in and lost assets they have to cover; banks also have to worry about non-compliance fines from the regulators.
That same UN report revealed that compliance costs are going through the roof and are estimated to climb by 50% in the next five years. Since the global financial crisis in 2008, fines to non-compliant banks have exceeded $320 billion, while only 1% of money-laundering flows have been stopped.
Technology developments are driving the digitization of financial services. Still, with the growing number of employees working virtually—combined with a lack of anti-money–laundering (AML) support for virtual environments—financial crimes continue to rise. Fraudulent activities are becoming more sophisticated and cheaper to execute than ever before, triggering a rise in digital financial crimes.
The new era of increased virtual environments—with growing numbers of digital transactions and their access points to data, healthcare-related scams, staff crunches, and reprioritized resources—enables criminals to do even more damage.
One of the main problems of many legacy bank systems is that they cannot view information across their multiple systems. So because they cannot close the gaps between independently operating systems, they cannot act until it’s often too late. Banks need a ‘bird’s eye view’ of their FCM landscape. That is where the cloud comes in, according to this document.
Many mid-and small-sized financial institutions adopt cloud computing because it offers massive data storage, on-demand high-performance computing, and near-infinite scalability.
Trust in Me, Just in Me
Trust is everything; no business can last without it. Banking is an industry where customer trust can be fragile, particularly where Amazon, Google, and Apple have built excellent customer loyalty based on great service and reliability. Banks now have much to compete against in building solid trust with their customers and are looking to increase customers’ trust with better protection of their client’s assets.
Automating FCM tasks such as AML and Know Your Customer (KYC) allow for frictionless customer experiences without compromising protection. The document outlines where FCM can generate the highest detection rates with the industry’s lowest levels of false-positive alerts.
Banks should deploy the most advanced cloud-native, cloud-agnostic, and API-first technologies to ensure their platform is agile, scalable, and flexible.
The document goes into more detail about how these FCM strategies can transform your bank from a risky and reactive one to a nimble, agile, and safe one.
Elevating Your Financial Crime Fighting In The Post-COVID-19 Era
A new e-book from Temenos and Microsoft, Elevating Your Financial Crime Mitigation Solution, shows how you can reduce costs and increase your FCM strategy’s effectiveness.