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17 Feb

Financial Crime Outlook

Financial Crime is a critical risk to businesses, there are a broad range of new and emerging criminal challenges facing organisations as a direct impact of the pandemic.

  • With limitations on international travel, conventional transnational organised crime schemes have been greatly affected, organised crime has diversified into fraud and cybercrime to respond to the changing environment.
  • Consumer spending patterns have changed, this has affected the ability of institutions to understand whether customer activity and behaviour is different from the normal baseline.
  • Increased number of vulnerable individuals seeking quick cash or means of substituting income. Criminals have capitalised on this, recruiting those experiencing financial hardship to act as money mules to transfer illicit funds.
  • A surge in internet-banking, resulting in additional volumes of online activity has created challenges in identifying suspicious transactions related to money laundering and fraud.
  • It has been reported that permanent working from home set-ups across the globe hinders first-line defence (self-policing) in a business and can limit the ability of compliance functions (second line defence) to act in an oversight and advisory capacity. This increases the risk of potential market manipulation and insider dealing offences.

Global authoritative bodies have published advisory papers outlining the evolving anti-financial crime challenges posed by the Covid-19 pandemic.

Firms should consider the following to strengthen their position:

  • Actively and proactively engage with regulators or authoritative bodies to gain greater understanding of the typologies and trends emerging from the pandemic, and factor these into their transaction monitoring rules and calibrations.
  • Investment in technology to apply sophisticated risk-based scoring and prioritisation to manage spikes and prevent backlogs.
  • Continue to apply rigour and challenge when assessing customer behaviour and activity – data from previous global events (for example the 2007–8 financial crisis) indicate that criminals actively work to find new ways to exploit public uncertainties and fear.

The Danos Group is a leading supplier of Financial Crime and Compliance personnel to the financial services industry globally, we are extremely well-placed to find you the best permanent and interim candidates.

Danos Associates is the leading global search firm. Our unparalleled network of professionals makes us the first choice for the world’s major financial services firms. We use our experience and market knowledge to help you land the best people for your permanent roles.

Please contact Denis Spearman if you would like to discuss your permanent hiring requirements.

Tel: +44 (0) 207 371 8332
Email: dspearman@danosassociates.com

Danos Consulting can support firms from risk assessment to implementation of Anti-Money Laundering (AML) governance structures, staff training and vendor selection, and client screening and monitoring practices.

We have an experienced bench of Financial Crime professionals from more senior MLROs (Money Laundering Reporting Officers) level consultants to more hands-on transaction monitoring, sanctions screening, AML/KYC practitioners. These consultants can be setup remotely at first to be able to assist as soon as possible.

Please contact Bradley Handelaar if you would like to discuss any interim/consultancy requirements you have now or in the future.

Tel: +44 (0) 207 010 1154
Email: bhandelaar@danosconsulting.com

Source: https://www.regulationtomorrow.com/africa/financial-crime-outlook-2021-and-beyond-2/

  • Author

    Bradley Handelaar

    Senior Associate, Danos Consulting

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