• Laurence Birnbaum-Sarcy, Leadership |

Financial service businesses know, or should know, only too well the cost of financial crime to people, profits and the planet. However, there are practical elements that make it difficult for them to fight these issues efficiently. Leaders must tackle the pressure of meeting the latest regulations, the challenge of keeping up with sophisticated criminals as technology marches on, the drain on resources for pandemic-damaged teams and the need to balance customer experience and reputation. No organization wants to be in the news for financing criminals and terrorists.

As financial crime, with its many dangerous tentacles, can reach into every corner of your organization, it's more important than ever for C-suites to bring teams together in a joint drive to tackle it.

Facing the challenge

It's no longer efficient or effective for the responsibility to fight financial crime to be split into silos, sitting with dispersed Anti-Money Laundering (AML) monitoring teams, fraud teams, sanctions teams, risk teams, data teams and more. There are many angles to financial crime and approaching it in this way can only exacerbate the struggle to battle the problem. Moreover, it's harder to coordinate the attack against financial crime in silos, and crucially, if one silo falls over at any point the whole system can be at risk. So how can a solution be found? I believe a wholesale transformation that's driven by executive leaders to bring fighting financial crime under one umbrella is needed.

But what does this mean in practice? It's time to create programs that bring expertise together from across the business, and that spread the responsibility and accountability so that nothing is missed as the industry develops. Of course, new ways of working can bring challenges, such as organizational structure, training, education and culture, but they can and should be addressed. So begin your thorough, thoughtful and risk-focused transformation journey as soon as possible. And during this change, remember that no matter which solutions are put in place, they will need to be agile and continuously monitored. Crimes evolve as the world changes; therefore, programs need to be flexible enough to withstand regular review, risk assessment and renewal.

Navigating the new world

In my view there is perhaps no better example of the need to be agile and innovative than the devastation and opportunity brought by the COVID-19 pandemic. Not only did it create new environments for financial crime to prosper, such as the acceleration of digitized financial services, it has also posed key internal challenges for businesses. People have become tired of the old ways of doing things and want to confront work from a different angle. More specifically, no one wants to look at alerts all day anymore, and remote work is becoming more and more normalized; this in turn can also create a problematic environment, with the risks of reduced employee due diligence, the lack of adherence to standards and the inability for leaders to monitor activity. Organizations can benefit from structural and cultural change, as mentioned above, but also from transformational technology, such as AI, to help monitor activity while ensuring they comply with regulations.

It may sound daunting, but it's not impossible. KPMG firms can assist your organization throughout its transformation and beyond, with unique programs tailored to your specific business needs and professionals with deep subject matter experience, who have themselves been on the frontlines fighting financial crime. This transformation is an ongoing journey, but with the right operating model, there is nothing to stop you from overcoming the obstacles thrown at you on the way. In the end, the goal is to prevent criminality and improve society, all while delivering compliance, helping to reduce costs and enhancing customer experiences.

Read additional blogs in our Financial Crime series.

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