Financial Crime World

Financial Crime Trends in Australia for 2023: Uncertainty Looms Amid Economic Volatility

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A recent survey reveals that 59% of firms in Australia expect financial crime levels to rise this year, while 58% plan to hire more staff to tackle the growing threat. The uncertain economic environment is driving a re-evaluation of risk appetite, with four key trends set to shape the compliance landscape.

Trend 1: Evolving Fraud and Scams

  • Tax and investment fraud top concerns for compliance teams
  • As the economy worsens, the temptation for criminals to offer bogus “get rich quick” schemes will rise

Trend 2: Surging Environmental Crime

  • 58% of firms identify environmental crime as a major concern when submitting suspicious activity reports (SARs)
  • Compliance teams should expect an increase in reporting and investigation of environmental crimes

Trend 3: Crowdfunding Platforms Fueling Political Extremism

  • 87% of compliance teams report an increase in the use of crowdfunding platforms to support extremist causes over the past year
  • Firms must be aware of these platforms and their potential role in financing political extremism

Trend 4: Global Sanctions and Regulatory Changes

  • The war in Ukraine will impact global sanctions, with Russia being the geopolitical hotspot firms worldwide are most concerned about
  • Compliance teams should expect new sectoral sanctions and a greater emphasis on enforcement
  • ASIC is preparing for new anti-money laundering regulations, including the implementation of a virtual asset licensing regime in Hong Kong and the regulation of non-financial professions such as lawyers and real estate agents

Expert Insights

Andrew Davies, Global Head of Regulatory Affairs at ComplyAdvantage, notes that 2023 will be a complex year for compliance professionals, with economic volatility, geopolitical tensions, and technological advancements driving change. “We highlight areas where trends have accelerated through the pandemic, including financing terrorist groups through decentralized platforms and environmental crime,” he said.

Digital Transformation in Compliance

  • Firms are rethinking their approach to regulatory technology, recognizing the need to digitally transform legacy systems and meet increasing regulatory expectations
  • 39% of firms identified digitally transforming legacy systems as their most significant compliance-related pain point

To stay ahead of these trends, firms can explore the State of Financial Crime in Australia for 2023 report, which provides insights into the key challenges and opportunities facing the industry this year.