In a shocking revelation, a recent survey has highlighted that 36% of firms in the emerging financial sectors of the UK have fallen prey to either money laundering or financial crime in the last half year. The banking sector has been particularly hard-hit, emerging as the most affected sector.
The SmartSearch survey sought insights from company compliance decision-makers spread across various sectors like banking, property development, and more. They shared their perspectives on the rise or decline in instances where malefactors attempted or succeeded in committing these financial improprieties. Disturbingly, almost half (41%) reported witnessing a surge in such crime attempts over the past 12 months. However, the majority felt there had been no significant change in the frequency of these criminal endeavours over the past year.
Martin Cheek, the Managing Director of SmartSearch, the UK’s frontrunner in providing anti-money laundering (AML) and digital compliance software, voiced serious concerns about the findings. He emphasised the escalating risk not just to the business entities but to the larger public and the economy as a whole.
Cheek cautioned, “Not only are companies facing an increased risk against money laundering and financial crime, but the regulations they must abide by to combat them are becoming tighter. The news that over a third of firms in emerging financial sectors have fallen victim to financial crime in the past six months alone is shocking.”
He also stressed on the rising instances of these crimes, influenced by several factors like the technological growth in areas like cryptocurrencies and AI, economic instability, and sophisticated criminal networks. Another alarming fact uncovered was that of the firms acknowledging their victimhood in the past six months, 42% were banks. This was followed by 37% from the crypto world, 36% from property development, and 30% from betting firms.
Most participants in this study hailed from various spheres like high street and challenger banks, OTC trading, exchanges, casinos, and both online and high street betting. A significant chunk, over half, were London-based.
Recalling the HMRC’s recent action in June, where they slapped fines amounting to £3.2m on several businesses for AML rule violations, Cheek opined on the need for robust AML measures. He mentioned, “When firms have robust AML measures in place, they greatly reduce the risk of falling victim to money laundering and financial crime.”
SmartSearch’s innovative AML solution has been a game-changer, saving countless businesses precious time and resources. Their state-of-the-art electronic verification platform aids in streamlining compliance, making it more efficient and effective.
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