Knowledgebase

What is Financial Crime

An overview of financial crime and how it can affect you

Financial crime has been a pivotal issue in the global arena for several decades now. Authorities are constantly looking for new ways to track down and prevent financial crime, and criminals are always developing innovative tactics in order to stay ahead. If you are involved in the finance or business sectors, it is critical that you understand what financial crime is and how it works.

Financial crime is defined as crime that is specifically committed against property. These crimes are almost always committed for the personal benefit of the criminal, and they involve an illegal conversion of ownership of the property that is involved. Financial crimes can occur in many different forms, and they happen all over the world. Some of the most common crimes facing the financial sector are money laundering, terrorist financing, fraud, tax evasion, embezzlement, forgery, counterfeiting, and identity theft. These crimes are committed every single day, and governments across the globe are constantly prosecuting financial criminals while searching for new ones.

The two most prevalent types of financial crime faced today are money laundering and terrorist financing. While the term “terrorist financing” is fairly straightforward, money laundering can be a more complicated concept to grasp. In essence, though, money laundering is simply the act of disguising profits that were obtained from crime. Cartels and mafia groups are some of the most prominent money launderers in popular news media, but money laundering can also extend beyond organised crime groups and can happen at many different scales.

Criminals who launder money and provide financing to terrorists generally use very sophisticated techniques, which means they are difficult to detect and catch. Both of these crimes are often international, as money launderers and terrorist financiers need to smuggle cash over borders to facilitate their plans. It is not uncommon for these criminals to have corrupt connections in government and business; these could include financial institution employees, accountants, government officials, and other service providers.

financial crime complyadvantage

The main method by which officials currently combat financial crime is extensive monitoring through the use of technology. Anti-money laundering technology has made it far easier to catch criminals in the act as it allows financial professionals to quickly gather, organize, and view data regarding accounts and transactions. Compliance software is now commonly used by  financial institutions and businesses to keep an eye on their clients due to its efficiency and ease of use. Platforms like ComplyAdvantage sift through lists of Politically Exposed Persons and other individuals who are at high risk of committing financial crimes, and they compile information about them in an organized and comprehensive manner.

Our AML solutions will help you prevent financial crime and stay compliant with the most up-to-date regulations.