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EU adopts new laws to combat money laundering
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The European Parliament has adopted a package of laws strengthening the EU’s toolkit to fight money-laundering and terrorist financing, ensuring that people with a legitimate interest, including journalists, media professionals, civil society organisations, competent authorities, and supervisory bodies, will have immediate, unfiltered, direct and free access to beneficial ownership information held in national registries and interconnected at EU level.

In addition to current information, the registries will also include data going back at least five years. The laws also give Financial Intelligence Units (FIUs) more powers to analyse and detect money laundering and terrorist financing cases as well as to suspend suspicious transactions.

The new laws include enhanced due diligence measures and checks on customers’ identity, after which so-called obliged entities (e.g. banks, assets and crypto assets managers or real and virtual estate agents) have to report suspicious activities to FIUs and other competent authorities. From 2029, top-tier professional football clubs involved in high-value financial transactions with investors or sponsors, including advertisers and the transfer of players will also have to verify their customers’ identities, monitor transactions, and report any suspicious transaction to FIUs.

The legislation also contains enhanced vigilance provisions regarding ultra-rich individuals (total wealth worth at least EUR 50 000 000, excluding their main residence), an EU-wide limit of EUR 10 000 on cash payments, except between private individuals in a non-professional context, and measures to ensure compliance with targeted financial sanctions and avoid sanctions being circumvented.

To supervise the new rules on combatting money laundering, a new authority – the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) – will be established in Frankfurt. AMLA will be charged with directly supervising the riskiest financial entities, intervening in case of supervisory failures, acting as a central hub for supervisors and mediating disputes between them. AMLA will also supervise the implementation of targeted financial sanctions.

The Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT)package consists of the sixth Anti-Money Laundering (AML) directive (adopted with 513 votes in favour, 25 against, and 33 abstentions), the EU “single rulebook” regulation(adopted with 479 votes in favour, 61 against, and 32 abstentions), and the Anti-Money Laundering Authority (AMLA) regulation (adopted with 482 votes in favour, 47 against, and 38 abstentions).

The laws still need to be formally adopted by the Council, too, before publication in the EU’s Official Journal.

By adopting the law, Parliament is responding to the demands of citizens put forward in the conclusions of the Conference of the Future of Europe, notably proposal 16(1) and 16(2) on preventing tax evasion and cooperating on corporate taxation.

Photo by Guillaume Périgois on Unsplash

AI now the key tool for amateurs committing financial crime
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Nearly 70% of the 600 fraud-management, anti-money laundering, and risk and compliance officials surveyed in BioCatch’s first-ever AI-focused fraud and financial crime report say criminals are more adept at using artificial intelligence to commit financial crime than banks are at using the technology to stop it. Equally concerning, around half of those same fraud-fighters report an increase in financial crime activity in the last year, and/or expect to see financial crime activity increase in 2024.

The report depicts a troubling and burgeoning trend in which criminals with minimal technical expertise or financial crime skillset are using this new technology to improve the quality, reach, and success of their digital-banking scams and financial crime schemes.

“Artificial intelligence can supercharge every scam on the planet,” BioCatch Director of Global FraudIntelligence Tom Peacock said, “flawlessly localizing the language, slang, and proper nouns used and personalizing for every individual victim the scam type, images, audio, and/or video involved. AI gives us scams without borders and will require financial institutions to adopt new strategies and technologies to protect their customers.”

A staggering 91% of respondents report their organization is now rethinking the use of voice-verification for big customers due to AI’s voice-cloning abilities. More than 70% of those surveyed say their company identified the use of synthetic identities while onboarding new clients last year.  The Federal Reserve believes traditional fraud models fail to flag as many as 95% of synthetic identities used to apply for new accounts. It regards synthetic identity fraud as the fastest-growing type of financial crime in the U.S., costing companies billions of dollars every year.

“We can no longer trust our eyes and ears to verify digital identities,” BioCatch CMO Jonathan Daley said. “The AI era requires new senses for authentication. Our customers have proven behavioural intent signals are those new senses, allowing financial institutions to sniff out deepfakes and voice-clones in real time to keep people’s hard-earned money safe.”

Other Key Survey Findings:

  • AI (Already) an Expensive Threat: More than half of the organizations represented in the survey say they lost between $5 and $25 million to AI-powered attacks in 2023.
  • Financial Institutions Also Using AI: Nearly 3/4 of those surveyed say their employer used AI to detect fraud and/or financial crime, while 87% say AI has increased the speed with which their organization responds to potential threats.
  • We Need to Talk: More than 40% of respondents say their company handled fraud and financial crime in separate departments that did not collaborate. Nearly 90% of those surveyed say financial institutions and government authorities need to share more information to combat fraud and financial crime.
  • AI to Help with Intelligence-Sharing: Nearly every respondent says they anticipate leveraging AI in the next 12 months to promote information-sharing about high-risk individuals across different banks.

“Today’s fraudsters are organized and savvy,” BioCatch CEO Gadi Mazor said. “They collaborate and share information instantly. Fraud fighters – including technology-solution providers like us, along with banks, regulators, and law enforcement – must do the same if we expect to reverse the growing fraud numbers across the globe. We believe our recent partnership with The Knoble will advance this discussion and remove the perceived barriers to better, more meaningful collaboration and fraud-prevention.”

MULTI-FACTOR AUTHENTICATION MONTH: Deploying multi-factor security across multiple sectors
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For anti-fraud professionals, the fight against unauthorised access is a constant battle. While passwords have long been the first line of defence, cybercriminals are becoming increasingly adept at cracking them. This is where Multi-Factor Authentication (MFA) steps in as a powerful tool, adding an extra layer of security and significantly reducing the risk of fraud across both private and public sectors. Let’s explore how anti-fraud professionals can deploy and leverage MFA solutions to create a more secure environment…

Private Sector Applications

  • Financial Services: Banks and other financial institutions can utilise MFA to protect customer accounts. This could involve a combination of passwords, one-time codes sent via SMS or authenticator apps, and fingerprint or facial recognition for high-value transactions.
  • Ecommerce and Online Retail: MFA can be implemented during online checkout processes, requiring customers to enter a code sent to their phone in addition to their password. This adds an extra layer of security and deters fraudulent purchases.
  • Remote Access and Cloud Security: MFA can be used to secure access to company servers and cloud-based applications. This is particularly important for businesses with remote workforces, ensuring only authorised personnel can access sensitive data.

Public Sector Applications

  • Government Agencies: MFA can protect access to government databases and e-services, safeguarding sensitive citizen information from unauthorised access. This is crucial for protecting national security and preventing data breaches.
  • Healthcare Providers: MFA can safeguard access to patient medical records. Doctors and authorised personnel would need to use a combination of factors, such as passwords and security tokens, to access patient data, ensuring confidentiality and compliance with data protection regulations.
  • Local Authorities: MFA can be implemented for council employees accessing online council tax systems or other sensitive databases, reducing the risk of fraudulent activity and protecting public funds.

Beyond the Basics: Advanced MFA Features

Modern MFA solutions offer a range of features to enhance security:

  • Adaptive Authentication: Risk-based authentication that adjusts the required factors based on the situation. For example, high-risk login attempts from a new device might require additional verification steps, while low-risk logins from a trusted device might only require a password.
  • Biometric Authentication: Fingerprint scanners, facial recognition, and iris scans can be used as additional authentication factors, offering a high level of security.
  • Geolocation Verification: MFA systems can verify a user’s location when logging in, potentially alerting them to suspicious login attempts originating from a different country.

The Future of Multi-Factor Authentication

The future of MFA holds exciting possibilities for enhanced security:

  • Integration with Artificial Intelligence (AI): AI can be used to analyse user behaviour and identify anomalous login attempts, triggering additional verification measures if necessary.
  • The Rise of Passwordless Authentication: Biometric authentication and secure token-based systems might eventually replace traditional passwords altogether, offering a more convenient and secure user experience.
  • Focus on User Education: Continuous user education on best practices for creating strong passwords and understanding MFA protocols will remain a crucial aspect of anti-fraud efforts.

Building a Robust Defence

MFA solutions are an essential tool for anti-fraud professionals in both private and public sectors. By deploying MFA and leveraging its advanced features, organisations can significantly reduce the risk of unauthorised access, data breaches, and financial losses. As technology evolves, so too will MFA solutions, offering ever-more sophisticated protection against evolving cyber threats. Remember, in today’s interconnected world, robust security is paramount. MFA is a critical line of defence in the fight against fraud, helping to create a more secure digital environment for everyone.

Are you searching for Multi-factor Authentication solutions for your organisation? The Fraud Prevention Summit can help!

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Visa delivers new Click-and-Mortar’ solutions
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Visa has unveiled new solutions for merchants who serve the new fast-growing segment of ‘Click-and-Mortar’ shoppers, who rely on digital features to shop both online and in-store.

“The payments sector has made significant strides in simplifying the consumer shopping experience. In doing so, the payments ecosystem has become more complex and fragmented for sellers — but it doesn’t have to be this way,” said Rob Cameron, Global Head of Acceptance Solutions, Visa. “Visa Acceptance Solutions allows businesses worldwide to offer their customers best-in-class payment options without over-indexing on complexity for themselves.”

Visa’s latest enhancements support merchants of all sizes with new and improved commerce experiences including:

  • Improved access to and ease of integration with partners: Visa Acceptance Platform is debuting Developer Assist, an AI-powered tool to help partners develop sophisticated payment flows, answer questions on testing and certification and even suggest sample code. The platform, which is used by more than 450 payment service providers (PSPs), connects to over 100 independent software vendors (ISVs), bringing ease of use to over 450,000 active merchants each month across 160 countries using 50 different currencies.
  • A reimagined small and medium-sized (SMB) business platform: Authorize.net has reimagined its user interface (UI), bringing data and streamlined day-to-day business operations to the forefront. The new UI has benefits for both partners and merchants across new dashboards, workspaces and smart search functionalities.
  • Growing mobile acceptance, without additional hardware: Tap to Phone, which allows sellers to accept contactless payments using a certified smartphone, is now live in 121 countries with more than 6.7 million active terminals and more than $8.5 billion in payment volume on a 12-month basis3. Visa is also deploying contactless technology from Tap to Phone in new innovative ways, including the recent pilot in Latin America and the Caribbean that allows consumers to tap their cards to their own device in order to pay for online purchases.

“The past few years have had a profound and lasting impact on the commerce strategies for merchants of every shape and size. Consumers desire immediacy and increasingly expect digitally evolved experiences. To keep pace with this trend, merchants are now looking for partners to help them simplify their ability to maintain connectivity to the ecosystem,” said Jordan McKee, Research Director at S&P Global Market Intelligence 451 Research.

Spain continues trends towards digitisation of payments
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The Spanish card payments market is forecast to grow by 8.9% to reach EUR402.6 billion ($435.4 billion) in 2024, supported by a constant consumer shift towards electronic payments.

GlobalData’s Payment Cards Analytics, reveals that card payment value in Spain registered a growth of 22.5% in 2022, driven by a rise in consumer spending. The value is estimated to have registered a growth of 18.1% to reach EUR369.8 billion ($399.8 billion) in 2023.

Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, commented: “Spain is gradually moving towards the digitalization of its payment infrastructure, supported by a high-banked adult population, partly due to citizens’ right to a basic account, and the expansion of its point-of-sale (POS) infrastructure. The growing acceptance of payment cards by retailers and the advent of contactless technology are set to reduce the share of cash within the economy.”

Cash remains an integral part of the Spanish consumer payments landscape, particularly for lower-value transactions. However, there has been a consistent decline in cash usage, while electronic payment methods have witnessed an increase. This is supported by a well-developed payment infrastructure with over 52,000 POS terminals per one million inhabitants in Spain – which is amongst the highest compared to many of its European counterparts.

The outbreak of the COVID-19 pandemic accelerated the rise in contactless payments in the country, thereby contributing to growth in overall card payments. According to the Study on the payment attitudes of consumers in the euro area (SPACE) in 2022, released by the European Central Bank (ECB), contactless payments in Spain accounted for 67% of all card payments at POS, in terms of volume, in 2022. The share was 66% when it comes to transaction value.

The cap on cash transactions is also pushing the use of card payments in the country. As of 2021, it became illegal for consumers to make cash payments of more than EUR1,000 ($1,073.2) to businesses, which means all amounts above the limit will have to be paid using electronic mode.

Sharma concluded: “The Spanish card payments market, which was affected by the pandemic, returned to a growth trajectory with impressive growth in subsequent years, supported by a rise in economic activity and consumer spending. However, an uncertain economic environment and rising inflation pose challenges for faster growth. The Spanish card payments market is forecast to grow at a compound annual growth rate (CAGR) of 6.4% between 2024 and 2028 to reach EUR515.9 billion ($557.8 billion) in 2028.”

Photo by Florian Wehde on Unsplash

MULTI-FACTOR AUTHENTICATION MONTH: How MFA became a fraud fighter’s favourite dance partner
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For years, online fraudsters have waltzed through checkout pages, leaving a trail of stolen identities and empty wallets in their wake. But the tide is turning. Multi-factor authentication (MFA), once a niche security measure, has become a vital weapon in the fight against merchant fraud. Here’s how…

The Rise of the Extra Layer:

Traditional online security relied on usernames and passwords, a flimsy barrier easily breached through hacking or social engineering. MFA adds an extra layer of defence. It requires users to confirm their identity with a second factor, such as:

  • One-Time Passcodes (OTPs): These temporary codes, delivered via text message, email, or an authentication app, add a time-sensitive layer of security. Even if a hacker steals a password, they can’t access the account without the ever-changing OTP.
  • Biometric Authentication: Fingerprint scanners and facial recognition software add a unique layer of security, as these biological traits are difficult to forge.
  • Security Tokens: Hardware tokens generate unique codes or require physical possession for authentication, adding a tangible layer of security.

MFA’s Impact on Fraud:

The impact of MFA has been undeniable. Studies show a significant decrease in fraudulent transactions since its widespread adoption. Here’s why:

  • Increased Difficulty: MFA makes it much harder for fraudsters to impersonate legitimate users. Stealing a password alone is no longer enough.
  • Stronger Deterrence: The knowledge that MFA is in place deters fraudsters from even attempting to target merchants with robust security measures.
  • Improved Customer Confidence: Customers feel safer shopping online when they know their accounts are protected by an extra layer of security. This can lead to increased sales and customer loyalty.

The Future of Anti-Fraud Solutions in the UK:

While MFA has been a game-changer, the fight against fraud is a constant dance. Here’s what anti-fraud professionals in the UK can expect:

  • Rise of Behavioural Biometrics: Beyond fingerprints and facial recognition, analysing typing patterns, mouse movements, and even browsing behaviour can offer a more holistic picture of a user’s identity.
  • Risk-Based Authentication: MFA won’t be a one-size-fits-all solution. The level of authentication required will likely be based on factors like transaction size, location, and user history. Low-risk transactions might only require a password, while high-risk transactions might require a combination of factors.
  • Frictionless Authentication: New technologies like voice recognition or wearable authentication devices aim to make MFA more seamless for users, without compromising security.

The Final Step:

MFA’s success story is a testament to the evolving landscape of online security. As fraudsters develop new tactics, anti-fraud professionals must stay ahead of the curve. By embracing innovative solutions and adopting a risk-based approach, they can ensure a secure and prosperous future for online commerce. Remember, the fight against fraud is a continuous dance, and MFA is just one of the steps needed for a smooth and secure online experience for both merchants and customers.

Are you searching for Multi-factor Authentication solutions for your organisation? The Fraud Prevention Summit can help!

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If you specialise in Multi-Factor Authentication Solutions we want to hear from you!
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Each month on Fraud Prevention Briefing we’re shining the spotlight on a different part of the market – and in May we’ll be focussing on Multi-factor Authentication Solutions.

It’s all part of our ‘Recommended’ editorial feature, designed to help industry buyers find the best products and services available today.

So, if you specialise in Multi-factor Authentication Solutions and would like to be included as part of this exciting new shop window, we’d love to hear from you – for more info, contact Jennie Lane on 01992 374 098 | j.lane@forumevents.co.uk.

May – Multi-factor Authentication
Jun – Digital Identity Verification
Jul – Fraud Detection Tools
Aug – Anti Fraud Platforms
Sep – AI for Fraud
Oct – Chargebacks
Nov – Biometrics for Fraud prevention
Dec – Mobile Fraud Prevention
Jan – Digital Identity Verification
Feb – Fraud Prevention Solutions
Mar – Risk Prevention & Compliance
Apr – Financial Crime

Photo by Ed Hardie on Unsplash

VIDEO: Why the Fraud Prevention Summit is your essential event for 2024
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The Fraud Prevention Summit will provide you with a rare full working day of industry networking, learning and connection building – will you be attending? – Secure your free place today! 

6th November 2024 | Hilton London Canary Wharf

Watch our attendee experience video to find out more about what to expect at the event! 

Your pass will be fully funded to attend as our guest, which includes: 

  • A seat at our insightful seminar sessions, led by industry thought leaders:
    • “The Fraud Mindset & Eradicating Mule Accounts” – Alex Wood, CEO – FPS
    • “Delve into the fascinating world of AI-powered fraud prevention and its profound impact on the financial industry“ – Rebekah Moody, Marketing and Go-to-Market Strategy – Darwinium
    • “The fight against fraud – are the latest laws working to tackle the fraud epidemic in the UK?” – Diana Johnson, Senior Lecturer – University of the West of England
    • “Critical leadership & team skills to help reduce merchant fraud, and how to deploy them” – Sarah Jones, CEO & Founder – Sarah Jones Coaching
  • Your own personalised itinerary of 1-2-1 meetings with industry leading suppliers, who can help with your upcoming plans and projects
  • Complimentary lunch and refreshments provided throughout the day
  • Multiple networking opportunities with fellow industry professionals
  • Personalised attendance options to suit your schedule


Book your FREE pass >>>

If you have any further questions, feel free to contact us here.

Report highlights cost of financial crime compliance in North America
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Financial crime compliance costs have increased for 99% of financial institutions in the US and Canada, with the total cost reaching US$61 billion across both countries.

LexisNexis Risk Solutions released the findings of its latest True Cost of Financial Crime Compliance Study – U.S. and Canada study, which was conducted by Forrester Consulting, 

Mid and large-sized financial institutions (holding more than $10 billion in assets) must reduce costs while complying with regulations, with 44% identifying the escalation of financial crime regulations and regulatory expectations as the primary factor driving increases in compliance costs.

Financial institutions of all sizes are concentrating on cost reduction, with 70% giving priority to cutting costs in the next 12 months.

The challenge of keeping up with the complex sanctions environment is intensifying, leading financial institutions to confront a growing screening workload. At 83% of mid and large-sized organizations and 87% of small organizations (holding less than $10 billion in assets), the number of screening alerts has increased.

Key findings from the study:

  • Technology costs are driving increases in expenses for financial institutions, emphasizing the substantial investment required to meet stringent compliance requirements. Specifically, 79% of organizations noticed rises in technology costs related to compliance/know-your-customer (KYC) software in the past 12 months, while technology costs associated with networks, systems and remote work have increased at 75% of businesses.
  • Seventy-eight percent of small financial institutions witnessed higher increases in compliance costs related to labor compared to their mid and large-sized counterparts (63%). Conversely, mid and large-sized financial institutions were more likely to experience higher cost escalations for technology, particularly in compliance with KYC software (82%) and external costs associated with outsourcing (79%).
  • Cryptocurrencies, digital payments and AI technologies are now also emerging as tools for illicit activities. Organizations are grappling with the impact of these sophisticated criminal methodologies within an already complex regulatory landscape. When asked about the types of financial crime they had observed significant increases of more than 20% in the past 12 months, 22% of companies identified financial crime involving cryptocurrencies, while 22% reported heightened use of AI.

“As the cost of financial crime compliance rises for organizations across the U.S. and Canada, organizations must take a strategic approach to financial crime compliance,” said Matt Michaud, Global Head of Financial Crime Compliance at LexisNexis Risk Solutions. “Skilled in-house compliance teams play a crucial role, but businesses should be actively seeking ways to reduce labor costs while simultaneously improving compliance efficiency. Organizations also need to actively counter cybercriminals exploiting artificial intelligence, cryptocurrencies and digital channels. Financial institutions must proactively equip themselves with comprehensive data sets, advanced AI/ML-based compliance models and robust analytics within their financial crime compliance solutions to swiftly identify new crime patterns.”

Photo by Greg Rosenke on Unsplash

Mastercard x Worldpay collab seeks to reduce merchant chargebacks
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Mastercard and Worldpay have formed a new partnership they claim will help merchants to resolve transaction disputes faster and with fewer chargebacks.

Chargebacks – a request for a refund triggered when a consumer disputes a transaction on their account – are a growing issue: industry-wide chargeback volumes are expected to reach 337 million by 2026, a 42% increase from 2023 levels.

Through the partnership, Worldpay, a global payment technology and solutions company, will offer Mastercard’s Ethoca Alerts to its 1 million merchants worldwide. The service provides an early warning system that helps prevent a dispute from becoming a chargeback and reduce potential financial losses due to fraud.

Ethoca Alerts, by Mastercard, works across all payment brands and delivers insights that merchants can use to stop the fulfilment of goods and services. Merchants do not need to change their existing infrastructure or processes to take advantage of Ethoca Alerts. 

The collaboration will also help improve authorization rates for merchants, enabling more of the $2.3tn total transactions Worldpay processes to be completed successfully thanks to fewer erroneously declined transactions.

Johan Gerber, Executive Vice President, Cyber and Intelligence at Mastercard said: “With ecommerce thriving, we’re working to make transactions as safe and as seamless as possible for all parties. This partnership with Worldpay extends our powerful technology to even more merchants around the world, reducing fraud. By working together, we will advance our shared goal of building trust and powering the global digital economy.”

Gabriel de Montessus, Executive Vice President, Global Enterprise at Worldpay said “We’re pleased to bring this solution to the market in partnership with Mastercard to deliver more value and innovation to our clients. Creating more accessible, more flexible and more seamless ways to reduce fraud, while accelerating commerce and protect consumers and merchants is what drives us at Worldpay.”

Between 2022-23 Ethoca Alerts enabled the prevention of $1.6bn in fraud due to chargebacks, helping to protect retailers from fraudulent claims.