Nearly all, or 92 per cent, of financial crime professionals say that "legacy technology" will become a barrier to fighting financial crime over the next two years. Technology systems that don't interoperate or process data properly were cited as a significant challenge by nearly 90 per cent of professionals assessed in a report carried out by LexisNexis Risk Solutions. 87 per cent of respondents said that their businesses weren't able to enhance their technology fast enough to counter evolving criminal methods. Read more: FTSE investors could lose hundreds of millions as a result of cyber crime As a result, evolving criminal methodologies like cyber crime emerged as the biggest financial crime risk that companies will face in the next 12 months, followed by geopolitical events, in the Future Financial Crime Risks report for 2017. Dean Curtis, UK managing director of LexisNexis Risk Solutions, said: "Keeping pace with criminal activity and understanding where technology has advantages over humans, in areas such as machine learning, will determine the future of many industries, none more so than Financial Crime prevention." Nearly 200 senior professionals working in retail banks, investment banks and asset management firms were surveyed and 44 per cent of respondents said evolving criminal methodologies were the biggest single financial crime risk they face. This figure rises to nearly 70 per cent when global investment bankers are assessed alone. "Criminal methodologies are constantly evolving and financial institutions are struggling to keep up with their changing tactics when implementing financial crime defences. For those tasked with combating­­ financial crime it can feel as if they are fighting twenty first century criminals with twentieth century tools," added Curtis. Geopolitical changes, the second biggest future financial crime risk, placed financial crime practitioners in retail banks among the most concerned. Nearly 40 per cent cited geopolitical events as the top future financial crime risk. Read more: Top City police chief warns businesses are leaving cyber crime unreported The financial crime professionals assessed were also asked how Brexit would impact their ability to combat financial crime. The results were mixed; half agree that it will have both positive and negative impacts, 30 per cent believe it will have a positive influence and 14 per cent believe it will have a negative one. The rest were unsure. During further interviews with senior financial crime professionals regarding specific geopolitical concerns, most indicated that changes in US sanctions arrangements were more concerning than Brexit. "Imposing sanctions has recently been the US tool of choice when responding to an international threat. Over half of these sanctions have been implemented since 2009 and the Trump administration may potentially continue to utilise sanctions in favour of costly military action. Financial institutions have found managing evolving sanctions policies and the introduction of new targeted sanctions tools – such as the sectoral sanction regime – to be a significant challenge, making them understandably concerned about the need to manage and update risk policies, process and controls," said Curtis.
Cyber crime has been pinpointed as the largest financial crime risk that companies believe they will face in the next 12 months, according to a report by LexisNexis Risk Solutions. The report, which was released on Tuesday, found that cybercriminals are targeting businesses and consumers with ransomware, malware designed to lock up data for ransom payments. A further 40% of respondents claimed that geopolitical events were the top financial crime risk for the year ahead.