In part one of this two-part blog on fighting financial crime, we talked about the factors that are converging to make the battle against financial crime more complex and costly in today’s financial world. In part two, we’ll talk about a new approach that tackles these challenges, helping financial institutions to not only achieve higher levels of security but also create competitive advantage.

The frequency and sophistication of financial crime continues to rise. Interestingly, an analysis of fines issued by the Office of Foreign Assets Control (OFAC) in 2015 for security lapses reveals that the cause in almost every case was an insider threat, such as the malicious use of credentials. While this is not the only cause, it is the main cause for sanctions and a major issue. As a result, most banks are facing the need to implement stronger cyber protection not only externally but also internally.

In implementing the best security practices, it helps not only to solve the core issue of protection for the institution, but also to promote that implementation across traditional and social media channels. As a result, client loyalty can be increased and market perception improved. Recent research has shown that protection of client assets is the highest priority issue for corporates and consumers when selecting a financial provider. Clients are willing to leave their bank if their needs are not met and, conversely, if the bank meets their expectations, business will increase.

A key weakness in most compliance strategies is the silo-based approach taken by institutions to fight financial crime and adhere to regulations. Historically, regulations that impacted corporate banking and those applied to retail banking were very different, so as the rules developed, strategies and processes were developed within specific departments in the bank.

However, as digital transformation continues to accelerate and banking becomes real time, new payment solutions enable consumers to send funds cross border. Which rules should apply in this case? How does the institution fight against terrorist funding and prevent money laundering?

One answer to this is to begin breaking down the operational silos. By bringing together all alerts from across the bank, a single intelligent system can help the bank to spot noncompliance and stop suspicious activity. Pulling all alerts into one management environment would enable patterns to be spotted and help prevent potential additional fraud.

What about all the data the bank is processing? As financial and cyber criminals become ever more sophisticated in their attacks and approach to crime, the institution needs to develop new strategies to stay one step ahead. One answer to this lies in big data and artificial intelligence.

Most current systems used to detect suspicious activity in banks are based on rules. While these systems are fast and pick up most known issues, new crimes require constant review and regular updating of the rules to stay one step ahead. Artificial intelligence, on the other hand, is able to “learn” and provide valuable data that can be used to enhance protection. Recent CGI pilot projects in banks have shown that this big data approach to fighting financial crime can identify and track new crimes and uncover fraud currently undetected.

While we have only scratched the surface of the underlying issues most banks are tackling in their fight against financial crime, it is clear to all that the problem is getting bigger, and with the global trend toward real time, the costs for managing the alerts created is increasing.

The strategies discussed above may not be the complete answer, but if applied to most institutions, they would improve security, reduce compliance costs and increase client satisfaction.

One final point; banks should consider finding a way to educate their staff, customers and partners. To successfully fight financial crime, everyone needs to play their part. You can deploy the very best solutions in the world, but due care and a concerted effort by everyone, criminals will continue to find a way to cheat the system.

To learn more, we invite you to read our paper, “Current Challenges in Fighting Financial Crime,” or to contact us at We welcome an opportunity to discuss your organization’s specific financial crime challenges and how CGI can help.

About this author

CGI’s Financial Services Practice

CGI’s Financial Services Practice

Founded in 1976, CGI is one of the largest IT and business process services providers in the world. Operating in hundreds of locations across the globe, CGI helps clients become customer-centric digital organizations. We deliver high-quality business and IT consulting, systems integration and transformational outsourcing ...