Financial Conduct Authority urges banks to turn to tech to fight cyber crime

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The UK financial sector spends £5bn a year fighting financial crime (Source: Getty)

Watchdog the Financial Conduct Authority (FCA) has urged the financial sector to use technology to fight criminals as it reveals 1.1m customers were refused services over financial crime concerns last year.

Speaking at an anti-money laundering event in London today executive director of supervision Megan Butler said technology is “increasingly essential to combatting financial crime”.

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According to the FCA’s financial crime survey, last year employees raised 920,000 suspicious activity reports to their money laundering officers.

Firms also sent 2,117 terrorism related reports to the National Crime Agency.

A total of 13,000 restraint orders were in place to freeze customer accounts, of which 3,600 were made during the previous year.

More than 1.1m prospective customers were refused services amid financial crime concerns and 370,000 customer relationships were ended over the same concerns.

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Butler, who said that British banks spend £5bn a year fighting financial crime, encouraged banks to adopt new technology to prevent fraud but warned that it was no cure-all.

“The question we get asked by financial institutions is essentially this: ‘will you let me off the hook if we introduce new tech’. The answer to that is no,” she said.

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“But that is not to say that new technology can’t significantly reduce your risk exposure if you implement it in a way that you would any other – involving proper testing, governance and management,” she said.

“Please do not be afraid – wherever you are based – of working with your regulators on systems that you feel might offer genuine benefit,” Butler concluded.

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