Morning Briefing: Financial services sector needs to get tougher on fraud

Morning Briefing: Financial services sector needs to get tougher on fraud

Morning Briefing: Financial services sector needs to get tougher on fraud Financial services sector needs to get tougher on fraud
The financial services sector, including the insurance industry, needs to improve its defenses against economic crime as 46 per cent of firms say they have been victims in recent years.

A global report from PwC shows that the number of respondents admitting to being hit by crimes such as fraud has increased from its 2014 poll. Among them,16 per cent had been targeted more than 100 times, 6 per cent more than 1000 times.

The report highlights the costs to insurers and others in the sector with 53 per cent spending more on combating economic crime and more than half expecting to spend more on meeting compliance requirements in the next 24 months.

In cases of fraud, the study reveals that 58 per cent of incidents were committed by external sources but almost a third (29 per cent) were committed by internal sources.

Along with fraud, money laundering, bribery & corruption and cyber are major crimes against the sector. The largest though is asset misappropriation.

PwC says that alongside damage to insurers’ reputations among customers when an incident occurs, is damage to relationships with regulators.

It advises greater use of big data analytics would help identify incidents but also growing risks to financial services firms. Biometrics, stronger IT security and the use of Blockchain technologies could all help curb the rise in economic crime in the sector.
 
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