Financial Crime Epidemic Costs Ireland Hundreds of Millions Every Year
A staggering €17.5 million was laundered through Irish accounts in the first half of 2023 alone, with money mule activity on the rise and criminal gangs targeting vulnerable individuals, including students and young people. Financial crime has become a pervasive issue in Ireland, with experts warning that it not only costs the economy hundreds of millions every year but also affects every single one of us in our daily lives.
What is Financial Crime?
Financial crime encompasses a broad range of illegal activities, from theft and fraud to bribery and corruption, human trafficking, and child exploitation. According to Colm O’Flaherty, director with Deloitte’s Financial Crime Advisory team, it can take many forms, including:
- Online scams
- Payment-card fraud
- Phone schemes
- Investment-related fraud
Impact on Individuals
KPMG managing director Katherine Gillespie notes that financial crime has a devastating impact on individuals, often resulting in the loss of hard-earned savings, including:
- House deposits
- Retirement funds
- Emergency cash
- Trust and relationships with others
Victims may also become more vulnerable and lose trust in those around them.
Technology-Enabled Criminal Activities
The rise of technology has made it easier for criminals to commit financial crimes. For instance, deepfake messages are being used to scam individuals out of their money. O’Flaherty warns that software can now make it seem like your mother, brother, or even co-worker is asking for money, making it crucial for individuals to be vigilant.
Prevention and Education
Experts agree that the first line of defense lies with individuals, who need to educate themselves on how technology can be used to commit crime. They must also learn to recognize and avoid suspicious activities, such as:
- Unsolicited requests for money
- Bank account details
However, there is a significant gap in Ireland’s defenses. There is no mechanism for information sharing between banks when it comes to financial crimes, allowing criminals to move easily from one institution to another.
Addressing the Gap
O’Flaherty believes that enabling financial institutions and other players to share information and knowledge could help prevent and address financial crime.
Changing Attitudes
While some level of financial crime may always exist, experts believe that a change in attitudes towards it could help reduce activity levels. Gillespie emphasizes the need for better education and awareness-raising to combat financial crime and change the mindset of those who might think it is victimless.
Conclusion
The consequences of financial crime are far-reaching, affecting not only individuals but also communities and the economy as a whole. It is essential that we take a proactive approach to combating this epidemic and work together to prevent and address financial crime in all its forms.