Telephone 020 3813 2890 for a free no obligation chat about your regulatory requirements with one of our compliance consultants.

© Compound Growth Limited 2012 - 2019 | Terms of Use  Privacy Policy

Registered in England and Wales as limited company number 07626537 - Registered Office 120 Pall Mall, London, SW1Y 5EA

We use cookies, if you consent to this use, please continue to browse our site.

Here to help with Regulation and Compliance

Compound Growth

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:

• Financial crime and the criminal activity it facilitates causes incalculable damage to society. The FCA’s joint endeavour is to monitor entry, devise controls and erect barriers powerful enough to stop criminals from causing further harm.
• New technologies give us unprecedented access to innovative products and services, and flexibility in how we use them. But they also give criminals sophisticated tools to bend the financial system to their own ends.
• More than 5 million people chose to lead an almost cashless lifestyle this year according to UK Finance, with using debit cards being one of the most popular methods of payment; however this also means that there is a growing dependency on ensuring technologies remain secure.

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.

Read our latest articles, news and views affecting compliance and regulation in the UK Financial Services Industry.