TechFinitive: Data is Key in the Fight Against Financial Crime

The global impact of economic crime is staggering. According to the Nasdaq Verafin 2024 Global Financial Crime Report, an estimated $3.1 trillion in illicit funds flowed through the global financial system in 2023. [...]

In our digital-first world, data is the most critical asset to combat these efforts. Financial institutions rely on data to extract insights, identify unusual behavior and inform ongoing monitoring that can help stop and prevent fraudulent activity. In this fight, the more data, the better. However, the ability to access and utilize all available data sources is anything but a straightforward endeavor. And, in many cases, regulations and guidelines put in place to help protect customers also unintentionally hamper investigators and empower criminals. 

To effectively combat economic crime, financial entities need to be able to leverage data while respecting regulatory barriers, organizational silos and security boundaries.

In recent years, this is a challenge that has been answered by breakthroughs in technologies, namely advances in a category known as Privacy Enhancing Technologies (PETs). PETs are unique because they specifically protect the usage of data, securing data while it’s being used or processed, and allow insights to be gained across boundaries and silos while minimizing risk.

The broader value and potential impact of PETs to unlock data value and enable data sharing and collaboration has been highlighted by many on the front lines of combating financial crime, including global regulators. The UK’s Information Commissioner’s Office (ICO) released an in-depth PETs resource in 2023 and followed up that guidance with the recent release of a PETs Cost-Benefit Awareness Tool and checklist. Additionally, ICO staff worked with officials from the Department for Science, Innovation and Technology (DSIT) to publish a Repository of PETs Use Cases.

While each of these documents is significant, the message they send when considered collectively is even stronger: the impact of PETs is important enough that the category warrants a commitment of resources from regulatory bodies and other government stakeholders. This affirmation, in turn, is causing leading financial institutions and other industry leaders to spend more time exploring the category’s impact.  

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