Institutions must apply âweakest linkâ thinking to their own anti-crime plans
Collaboration between financial institutions is the vital ingredient in the fight against financial crime, according to research announced by LogicaCMG today. The study highlights that nearly two thirds (60 per cent) of respondents believe the industry working together is a âmustâ in tackling crime.
The report revealed that the finance industry believes collaboration will not only help the industry gain a greater understanding of the issues, but will also directly impact on the problem with 59 per cent of financial institutions stating that it would lead to a cut in the volume of financial crime.
This realisation of the need to take an industry-wide approach can be put down to the rise of new forms of crime such as phishing and âmiddle-class crimeâ, alongside new regulations such as the Financial Services Authority directives on anti-money laundering. Reflecting current attitudes, financial crime is higher on the agenda than ever before according to two thirds (63 per cent) of respondents. However, the importance of the issue is not being backed up by investment to tackle it, with an alarming 83 per cent of institutions admitting that they have no dedicated budgets for the battle against crime.
This lack of investment is exacerbated by institutions focusing on tackling certain hotspots, rather than creating a holistic strategy across the business. The focus on only some areas of crime, coupled with the apparent lack of investment, shows other areas including identity theft, âcardholder not presentâ fraud and fraudulent claims are being left open to attack.
Commenting on the findings, Guy Warren, LogicaCMGâs managing director of financial services in the UK said: "Currently criminals are seeking out and targeting the weakest links in the industry. If the wholesale banking community improves security, criminals will instead turn their attention to retail banking or insurance. Only by working together collaboratively can the institutions put together a united front in this fight, and it is encouraging news that the industry understands this. However, institutions must apply this thinking when looking at their own plans to tackle financial crime as, without a holistic strategy, criminals will always target the weakest link in a bankâs defences."