Payments community calls for action to tackle financial crime

The UK financial services industry must do more to face down the threat posed by money laundering and payments-related financial crime, according to a new report published by the Emerging Payments Association (EPA).

The issue of money laundering in the UK has become ever more pressing in recent years. The country’s National Crime Agency (NCA) observed in its recent national strategic assessment that the scale of money laundering through the UK could potentially be “in the hundreds of billions of pounds” annually. This can have a significant negative impact on the UK’s economic and social fabric, due to its association with a number of other crimes, from modern slavery, to human trafficking, and other illicit trade activity.

To understand these effects, the EPA produced the report, Facing Up To Financial Crime, with the support of a syndicate of EPA members led by Refinitiv and Barclays. This paper explores the latest developments in the way fraudsters and money launderers abuse payment services and bank accounts to commit serious financial crimes, setting out 12 recommendations for industry members to take action.

These include guidance on the effective use of technology to tackle the threat, as well as advice on enhancing information sharing and suggestions for comprehensive and consistent reporting of criminal activity. The report also recommends championing digital identity as key to tackling these abuses, calling for payments and financial services companies to harness new technologies and to work collaboratively in order to create a world-leading digital identity solution for the UK.

Finally, the report calls for sector-wide activity led by the EPA to promote information sharing by government and law enforcement agencies with financial services companies for mutual benefit, through the use of a common platform and commercial model. It also recommends collaboration across trade associations to promote the adoption of best practice among PSPs for risk management to comply with financial crime legislation and enable continued access to banking facilities.

Speaking about the report, Tony Craddock, Director General of the EPA, commented, “Financial crime concerns every company in the payments industry. Because it affects everyone involved in moving money, whether consumers, businesses or governments. In this report, we have identified what’s really going on, by whom and at what cost. We have developed recommendations for action that are clear, timely and impactful and we call upon interested parties to collaborate with us.”

John Davies, Founder and Chairman of Kompli-Global, Deputy Chair of the EPA and Mentor of Project Financial Crime added: “Financial crime has serious ramifications for both genuine companies and ordinary people, with social consequences ranging from political corruption, to human trafficking, to terrorism. As responsible businesses, it is imperative that all of us working in the financial services sector do our utmost to safeguard our customers and the wider community from the repercussions of such criminal activity. Using the guidance in this report, and technology that is already available, we can all ensure we achieve this goal, playing our part in helping to prevent financial crime in the future.”

To read the report, visit: www.emergingpayments.org/article/facing-up-to-financial-crime/
To find out more about the EPA, visit: www.emergingpayments.org.

With thanks to Barclays, Refinitiv and the other five syndicate members in supporting this whitepaper and for investing time and resource to make this paper possible.