The Asia-Pacific region is currently in the midst of a financial crime epidemic, with the vast majority of businesses suffering a hit in the last 12 months – however, it seems leaders in the area aren’t taking the challenge lying down.
According to a report released by data specialist Refinitiv, careless onboarding of new customers, suppliers and partners has created an environment in which criminal activity can thrive.
In fact, a huge 75% of APAC businesses reported that they had fallen victim to financial crime over the previous year and 44% had experienced cases committed by their own employees.
“With companies only conducting due diligence on around half of external partners and customers, despite them accounting for the majority of financial crime cases, this is enabling an environment for criminal activity to flourish,” said Alfred Lee (pictured), managing director of Asia-Pacific at Refinitiv.
Despite the prevalence of the costly crime, a relatively low amount is invested into the area – in Australia, an average of just 5% of turnover is spent on customer and third-party due diligence checks.
“More investment must be made in technology and processes,” said Lee. “Increased collaboration between technology companies, governments and financial institutions is critical to address this issue.”
While the statistics are certainly disappointing, it seems businesses are beginning to respond – 60% of companies have adopted new technologies designed to combat financial crime and, over the next year, APAC firms said they intend to spend an average of 47% more to mitigate the crisis.
Although plans for investment sit at slightly below half, an overwhelming 97% of respondents in the survey agreed that technology can significantly help with financial crime prevention.
However, it seems there are still some challenges for businesses seeking to overcome financial crime and 72% said they struggle to harness tech advancements.
