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Norway Grapples with Financial Crime Prevention in the Digital Age
A recent conference in Norway brought together experts from various fields to discuss the growing menace of financial crime prevention in the digital age. The event highlighted the need for increased transparency and information sharing between financial entities to combat cyber-related financial crimes.
The Growing Threat of Financial Crimes
According to Sebastian Claydon Takle, Financial Cyber Crime Centre (FC3) DNB, criminals are increasingly using digital platforms to trade services and establish networks for knowledge transfer. To stay ahead of these criminals, banks must be more open about their exposure and share significant amounts of data in transaction monitoring.
The Scope of the Problem
DNB Norway identified fraud worth 920 million NOK in 2021, with 734 million NOK stopped. The same year saw a 60% increase in fraud cases, with digital fraud increasing by 300%. This highlights the need for more advanced arrangements to combat growing digital criminality.
The Rise of Cryptocurrencies
The use of cryptocurrencies such as Bitcoin is also becoming increasingly popular among criminals, particularly in ransomware attacks where large sums of money are demanded from victims. Victims often choose not to go public with incidents, but according to DNB’s practice, they report incidents to the Financial Police when several incidents can be linked to one specific actor.
The Connection between Fraud and Money Laundering
The connection between fraud and money laundering is also apparent, with 33% of organized crime involved in both activities. Economies of scale are allowing criminal networks to grow, with some earning billions of euros from investment fraud.
Advanced Criminal Networks
Eirik Sneeggen from the National Cyber Crime Centre (NC3) emphasized that advanced criminal networks have grown to be comparable in size to state-own enterprises, built up over time with a long-term view to develop competence and tactics. He also highlighted the use of mixing services to cover tracks and the growth of decentralized finance.
Developing Relevant Competence
The event’s speakers agreed that developing relevant competence is crucial in preventing financial crime. This includes:
- Detecting rapid changes in transactional patterns
- Analyzing behavioral patterns linked to age and sex
- Understanding customer knowledge about cryptocurrencies
- Employees having access to tracing tools and further knowledge to investigate mixing and darknet usage
Focus on Financial Crime Prevention
Henrik Skådinn of FCG Norway concluded the event by recommending that organizations focus more on financial crime prevention rather than regulatory compliance. He suggested asking the question: “How would your organization act if there were no regulatory requirements, and how that would impact efficiency?”
Conclusion
As Norway continues to grapple with financial crime prevention in the digital age, it is clear that increased transparency, information sharing, and relevant competence are key to staying ahead of these criminal networks.