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FCA Speech: Turning Technology Against Financial Crime
Technology & Financial Crime
23rd October 2019
The FCA published a Speech given by the Executive Director of Supervision – Investment, Wholesale and Specialist, Megan Butler, delivered at the Royal United Service Institute in London.
The topic for Ms Butler’s speech was ‘Turning technology against financial crime’ whereby she updated those in attendance on the current estimates that serious organised crime that money laundering facilitates costs the UK – this being £37bn every year, whilst the estimated annual cost of fraud in the UK stands at a staggering £190bn!
It seems that fraud now accounts for around one third of all crimes experienced by individuals and in the last year, there has been an increase of 17% in fraud offences (to 3.8million offences) that have been driven by an increase in bank and credit account fraud.
As Ms Butler advised, there are already requirements in place that aim to combat fraud, money laundering and terrorist financing across the financial sector with a requirement that focuses on the need for effective systems and controls in firms to detect, disrupt and stop criminal activity.
However, “the fast pace of technological change and ever-evolving nature of criminals means that these systems and controls do not always change as quickly as the threats themselves. Lots of people talk about technology as an enabler of financial crime.” However, Ms Butler instead wished to focus “on how technology can be used to detect and disrupt financial crime, and ultimately the criminals who seek to exploit the system”.
Highlights from Ms Butler’s speech included:
In conclusion, Ms Butler advised Firms that whilst technology is “frequently an enabler of crime, [it] can also be a hugely potent tool in the fight against it. So, if I could leave the industry with one message today it would be, don’t be afraid to use technology and innovate to keep criminals out.” Therefore, used to the right ends, it is thought that technologies can be huge ‘gamechangers’ in the fight against financial crime for both the industry and the regulator.
To read the whole of the Speech, click here.
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