" class="no-js "lang="en-US"> EPA warns of ticking time bomb of financial crime marketplace
Friday, June 09, 2023

EPA warns of ticking time bomb of financial crime marketplace and importance of digital identity

The Emerging Payments Association (EPA), which promotes collaboration and innovation across payments, has today released its whitepaper, ‘Financial Crime, Payment Fraud, and the Role of Digital Identityin partnership with Refinitiv.

The whitepaper highlights how criminals can profit from financial crime and commit payment fraud, working together to create a financial crime marketplace utilising the latest technologies. In addition to detailing the current landscape and emerging threats, based on proprietary research, the whitepaper provides insights into how fraud controls can be improved.

With the National Crime Agency (NCA) estimating that the total cost of organised crime to the UK economy amounts to £37 billion annually, current defence approaches are broken. Fundamental change is required as society, organisations and individuals are all suffering as a result of financial crime. The problem is likely to get worse, as criminals are innovating at scale and staying at least one step ahead of Financial Services (FS) providers.

Through extensive primary research the whitepaper explores the primary emerging threats, including the rise in botnet attacks, risks relating to increased contactless limits, synthetic identities, and the increasing volume of data that is available to criminals. It found that Digital Identity (DI) services can solve several of today’s problems, if implemented well, but it is recognised that they are not the complete answer. Of those interviewed for the research, many payment professionals felt that the lack of a national DI service is a key obstacle in fighting crime and fraud.

A key area of focus was investigating the potential for digital identity as a secure foundation layer, in order to reduce financial crime and payment fraud. Interviewees included subject matter experts from financial services providers, card issuers, payment processors, digital identity specialists, consultancies, and solution providers.

Tony Craddock, Director General of the Emerging Payments Association, commented: “Occurrences of financial crime are soaring, and we are staring down the barrel of a fraud-shaped gun unless we as an industry start working to get these numbers under control. Along with data sharing and better collaboration, one of the key findings of the research was that digital identity will play a critical role in this going forward, providing a secure foundation layer to prevent crime upfront and on an ongoing basis.”

James Mirfin, Global Head of Digital Identity & Fraud Solutions at Refinitiv, said “The unprecedented growth in the scale, sophistication and creativity of criminals who are able to deploy technology in their pursuit if ill-gotten gains should concern us all. The industry must continue to collaborate on solutions like Digital Identity, which can materially impact the activities of criminals and fraudsters, and we need to demonstrate tangible progress.” 

Jane Jee, Chair at Kompli-Global and Project Financial Crime leader at the Emerging Payments Association, said: “Criminals understand how they can profit from financial crime and commit payment fraud as evidenced by the escalating number of attacks and levels of losses incurred. I find it worrying how they are now working closer than ever before, in effect creating a crime marketplace and adopting the latest technologies. Promisingly, as our research highlights, some initiatives are making a real difference and it suggests how are industry must work together more going forward.”

To download a copy of the whitepaper, please visit: https://www.emergingpayments.org/whitepaper/financial-crime-payment-fraud-and-the-role-of-digital-identity/

For more information on the work and services of the EPA you can visit: www.emergingpayments.org you can speak directly to the EPA at: [email protected]

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