Financial Crime World

Financial Crime Compliance: Navigating the Top Trends in 2024

Amidst geopolitical turmoil and the surge of cybercrime, financial crime compliance has become increasingly important. In this article, we will discuss the top trends expected to shape the financial crime compliance landscape in 2024, based on a recent assessment by LexisNexis Risk Solutions.

Real-time monitoring eases compliance navigation

With the surge in real-time transactions, real-time monitoring has become essential for financial institutions to detect and prevent fraud and ensure adherence to various sanctions. Key findings from LexisNexis Risk Solutions include:

  • Global real-time transactions increased by 63.2% in 2022.
  • 27.8% of all electronic transactions were conducted in real-time.

Real-time monitoring will remain a critical tool in ensuring trade compliance and navigating rapidly evolving regulatory frameworks.

Data and analytics emerge as strategic assets

Data and analytics are playing a pivotal role in compliance management, and companies are expected to invest heavily in advanced analytics tools for better decision-making and financial crime detection. Predictive analytics are increasingly adopted to anticipate risks related to financial crimes, such as money laundering. Furthermore, integration of all processes and departments onto a unified digital platform can lead to streamlined workflows and valuable insights.

Wildlife trafficking re-emerges as a major concern

Wildlife trafficking, a global illegal sector generating significant revenue, remains a pressing concern. Major players in wildlife trafficking include India, China, Indonesia, and Malaysia, and revenues returned to pre-pandemic levels in 2022. This illicit trade involves organized crime rings, corrupt governments, and entire financial systems. Moreover, wildlife trafficking can result in significant health and environmental concerns due to the lack of appropriate surveillance and containment for animal parts entering various countries. Key findings from 2022 include:

  • 50% of maritime seizure weight involved wildlife trafficking.
  • Major wildlife goods, such as ivory, result in around 10% being caught by law enforcement agencies.

Staying informed about these trends is critical for financial institutions and corporations to effectively navigate the financial crime compliance landscape in 2024.

Changing sanctions necessitate a dynamic compliance approach

Following the Russia-Ukraine war, numerous countries have imposed sanctions, resulting in frequent updates to the UN, EU, and UK lists. The fast-changing and complex sanctions landscape demands a dynamic and continuous risk assessment and automated compliance checks from companies to avoid breaches and maintain regulatory compliance.

Unveiling UBOs becomes easier than ever

Identifying Ultimate Beneficiary Owners (UBOs) of an organization has historically been challenging, making regulatory compliance a challenge. However, advances in technology and regulatory requirements are making it increasingly easier for companies to uncover UBOs. Improving transparency and mitigating risk in financial transactions is crucial for financial institutions and corporations in 2024.