Digital is on the forefront of many minds working in financial crime compliance. They look at the changes and new capability requirements with real fear. The regulatory climate increases personal accountability for compliance professionals, who are predicting new risks and uncertainties. Few have clarity about what all the change means and what the tangible outcomes might be.

Accenture recognises that banking is changing and that firms are working hard to compete in an ever competitive market. In our view, the digital revolution presents firms with a real opportunity to improve their management of financial crime compliance, reduce financial crime risk, support customer management and help drive down compliance costs.

Financial crime compliance issues

The current changes present financial institutions with several financial crime issues, ones that will require revisions to existing financial crime functions. These include:

  • Customer expectations: Meeting customer expectations is an ongoing difficulty for banks and has become more pronounced in recent years. Rapid improvement in technology has been the catalyst for this: Carrying out transactions via online retailers is seen as a swift and efficient process, and encourages customers to expect all dealings with retailers and vendors to follow this pattern.
  • Fit-for-purpose controls: These measures assess the extent to which existing financial crime controls would be fit for purpose in the digital world. For instance, carrying out identity checks ahead of face-to-face or more personal exchanges should lose its strength as more customers gain the anonymity that digital banking provides.
  • Ineffective blanket controls: Controls that can be put in place will be very different than those that have come before. The use of blanket controls will diminish, in part due to the ever increasing personalisation of new digital products, and also the changing demographics of customers.
  • Cybersecurity: The rapid expansion of technology inevitably provides more scope for misconduct.
  • Data: Customers expect the vast amount of data placed into financial services’ hands through digital tools is adequately protected and used appropriately.
  • Cost: The increase in regulation, paired with the enforcement climate, has meant an escalation in financial crime compliance costs.

Given this lengthy list of issues, what can compliance professionals do to tackle the challenges they face? My next post will look at some of the future themes we see for fraud and financial crime.

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