The battle against financial crime becomes enterprise-wide

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LONDON – A new report conducted by Datamonitor for compliance and financial crime software provider Norkom finds that in the struggle against financial crime, the big firms are increasingly adopting an enterprise-wide effort.

The report claims that adoption of enterprise-wide efforts has seen “a radical change”, and enterprise-wide investigation is now prominent on the mainstream of financial firms’ strategies for financial crime.

“The new enterprise-wide, risk-based approach is all about getting the best return on existing and new investment to marshal resources and technology into a financial crime approach,” said Hilary Duffy, marketing manager at Norkom.

"Last time our respondents reported that organisational inflexibility was hindering them in their approach to uncover and manage financial crime across the enterprise on a global scale. That's now being overcome with the development of Financial Intelligence Units (FIUs). The leading institutions are adopting FIUs to marshal their organisational resources and overcome siloed management structures" added Duffy.

The report says 47% of firms surveyed had created FIUs, while a further 14% planned to create them.

The report showed the continuing priority of identity theft, although it also highlighted a shift in priorities toward anti-money laundering efforts by the biggest financial institutions.

The enterprise-wide approach is also shown to be moving more generally into the mainstream, with 73% of respondents managing anti-money laundering (AML) in tandem with other types of financial crime; 53% achieving this on an enterprise-wide basis; and another 20% making significant progress.

This contradicts last year’s OpRisk & Compliance intelligence survey, which concluded that 54% of firms did not allow for centralised investigation, though this may give further support to the claim of a shift in the adoption of enterprise-wide investigation.

The survey highlighted compliance as not just a matter of regulatory compulsion to prevent fines or losses but a fiscal necessity, as firms look for efficiency, increased productivity and generally tighten their belts for the credit crunch.

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• Topics
• Enterprise risk management (ERM)
• Financial crime
• Regulation