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Financial crime compliance costs soar

Posted in: Blog

New regulation and advancing criminal methodologies have seen financial crime compliance costs continue to soar in financial institutions in the last two years, according to new research from LexisNexis Risk Solutions, the global information solution provider, a part of RELX Group.

Previous 2015 research conducted on future financial crime risk by LexisNexis Risk Solutions, revealed major financial institutions collectively were exhausting billions of pounds annually on financial crime compliance. Since then, the 2017 research indicates that costs have risen, and are being been most keenly felt by retail banks (69% of who reported an increase) and asset management firms with over £100bn of assets under management (86% reporting an increase).

“A large number of firms have thus seen their costs spiral, a situation often exacerbated by legacy technology unfit to cope with the complexities of modern financial security and regulation, driving the need for more human resource. The problem is further compounded by the data utilised in risk decision making, which can be unstructured and of poor quality. 

Dean Curtis, UK Managing Director at LexisNexis Risk Solutions comments on the findings:

“The past two years have seen a wealth of new regulation issued which continues to increase demands on financial crime departments. It is clear that the cost of regulatory compliance is continuing to weigh heavily on financial institutions and also comes at a time when these organisations are becoming increasingly concerned about evolving and complex criminal methodologies. 

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