# AI – the hidden weapon in the battle against financial crime
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-08-25
Category: TECHNOLOGY
Category URL: https://financedigest.com/category/technology
Meta Title: Combat Financial Fraud with Holistic AI Approach
Meta Description: Learn how financial organisations can use AI technologies to strengthen fraud prevention, protect against cyber threats and streamline investigations for a
URL: https://financedigest.com/ai-the-hidden-weapon-in-the-battle-against-financial-crimehtml

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_By_ **_Neil Murphy,_** _Global VP at ABBYY_

![Neil Murphy, Global VP at ABBYY](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/picture18-1736837971135-compressed.jpg)

Neil Murphy, Global VP at ABBYY

Fraud is a million-pound problem with [one in fifteen](https://www.gov.uk/government/publications/economic-crime-plan-2019-to-2022/economic-crime-plan-2019-to-2022-accessible-version) people falling victim every year, making it one of the most common crimes in the UK. To combat financial crime, the industry has been investing heavily in its security system, fraud prevention initiatives and technology. However, the financial criminals are [continuously adapting](https://www.financedigest.com/scholz-if-germany-continues-to-adapt-we-will-make-it-through-winter.html "Scholz: if Germany continues to adapt, we will make it through winter") their methods and the battle against fraud rages on. In fact, according to UK Finance, unauthorised financial [fraud losses across payment cards](https://www.financedigest.com/uk-card-fraud-losses-climbed-18-percent-in-2015-largest-rise-in-europe.html "UK CARD FRAUD LOSSES CLIMBED 18 PERCENT IN 2015, LARGEST RISE IN EUROPE"), remote banking and cheques totalled almost £800 million in 2020. It should come as no surprise then that the [way financial](https://www.financedigest.com/10-ways-to-make-your-financial-model-easier-to-understand.html "10 Ways to Make Your Financial Model Easier to Understand") organisations assess and manage risk needs to change.

[Technology can be a double-edged sword when it comes to mitigating financial](https://www.financedigest.com/shakedown-on-horizon-for-financial-technology-world.html "Shakedown on horizon for financial technology world") fraud. When technology evolves, criminals use increasingly sophisticated methods to carry out attacks.  Therefore, organisations must take a holistic approach to protecting themselves by taking a closer look at improving their processes, using data more effectively and harnessing a combination of [artificial intelligence](https://www.financedigest.com/types-of-artificial-intelligence.html "Types of artificial intelligence") (AI) technologies to be safe and secure. Only by wielding these weapons can businesses win the battle against [financial crime](https://www.financedigest.com/financial-crime-is-the-chink-in-the-banks-armour.html "Financial crime is the chink in the banks’ armour").

In an effort to combat financial fraud, businesses must take a [holistic,](https://www.financedigest.com/thomson-reuters-builds-out-its-award-winning-connected-risk-platform-with-risk-management-solution-providing-a-personalized-enterprise-wide-view-of-risk.html) AI powered approach – but what does this involve?

**Turning data insight to impact**

[Financial services are a data](https://www.financedigest.com/data-fake-will-be-the-new-real-in-financial-services-in-2023.html "Data: Fake will be the new real in financial services in 2023") heavy industry. From structured, unstructured, transactional and account-level, it’s clear that there is no shortage of it.  While this data [brings benefits in terms of consumer insights](https://www.financedigest.com/incoming-starbucks-boss-to-bring-consumer-insight-to-coffee-culture.html "Incoming Starbucks boss to bring consumer insight to coffee culture"), in the hands of nefarious actors, it can make fraud more pervasive. It’s true that initiatives like General [Data Protection Regulation (GDPR) have certainly ramped up the regulation of consumer data, but there is still a huge opportunity to uncover insights with the data to bring more benefits to the financial](https://www.financedigest.com/how-data-governance-as-a-service-can-transform-the-financial-sector.html "How Data Governance-as-a-Service can transform the financial sector") organisation.

In the [finance industry](https://www.financedigest.com/application-security-in-the-finance-industry-what-you-should-know.html "Application Security in the Finance Industry: What You Should Know"), building trust and customer loyalty are incredibly important, which is why fraud can be detrimental to their reputation, and result in added cost. By collecting the data from fraud, anti-money laundering (AML), and cybersecurity, [financial organisations can consolidate](https://www.financedigest.com/make-way-for-the-rise-of-the-finance-super-apps-consolidation-of-financial-digitisation-tools-platforms.html "Make way for the rise of the Finance Super Apps – Consolidation of Financial Digitisation Tools & Platforms") information across historically isolated functions and make more informed decisions with a holistic view of risk.

By identifying similarities from the data collected across AML, fraud, and cyber teams, breaking down these silos can provide a more transparent view of the threat landscape, better detect suspicious transactions, and streamline investigations. Since the criminals are using cyberspace to commit fraud and ultimately need to monetise that information so that the funds appear legitimate, it makes [business sense to bring these functions together](https://www.financedigest.com/how-to-bring-business-and-charities-together-through-events.html "How To Bring Business And Charities Together Through Events").

**360-degree view to** [fraud prevention](https://www.financedigest.com/payroll-fraud-and-how-to-prevent-it.html "Payroll fraud and how to prevent it")

Before financial [organisations](https://www.financedigest.com/can-financial-services-organisations-harness-data-and-bi-to-catch-up-in-the-digitalisation-race.html "Can financial services organisations harness data and BI to catch up in the digitalisation race?  ") look toward technology to mitigate financial fraud, there are few steps they must take to ensure they are making the most out of these investments. First [financial institutions need to be able to identify the bottlenecks and blind spots](https://www.financedigest.com/new-york-holds-top-spot-london-second-in-z-yen-financial-centre-survey.html "New York holds top spot, London second in Z/Yen financial centre survey") in their business processes, to see which areas need to be improved and where automation will be needed. With process intelligence organisations can analyse less structured processes, identify opportunities for improvement, and increase both the speed and accuracy of executing said processes. With this holistic approach, [financial institutions](https://www.financedigest.com/the-future-of-financial-institutions-in-2023.html "The Future of Financial Institutions in 2023") can collect and analyse intelligence from across the organisation. This model improves intelligence sharing across the industry and allows [financial institutions to continuously test and improve their security](https://www.financedigest.com/5-steps-to-strengthening-your-online-financial-security.html "5 Steps to Strengthening Your Online Financial Security") playbooks.

Once they have a 360-degree overview of their business processes, the most effective place to begin automating is the onboarding process. Streamlining onboarding by [leveraging modern technologies enables financial institutions](https://www.financedigest.com/3-ways-financial-institutionscan-leverage-live-engagement-on-social-media.html "3 ways financial institutions can leverage Live Engagement on social media") to filter out fraudulent actors and deliver a more frictionless experience for their customers. Using a combination of technologies, for example artificial intelligence (AI), robotic process automation (RPA), and natural language processing (NLP), can enable [financial institutions](https://www.financedigest.com/what-the-future-holds-for-financial-institutions-in-2023.html "What the Future Holds For Financial Institutions in 2023") to process both structured and unstructured documents, minimise manual steps, and reduce the need for making redundant requests of the client. Establishing an effective client onboarding process not only enables faster [detection of potential fraud but plays a significant role in developing relationships](https://www.financedigest.com/the-clues-to-detecting-fraud-are-hidden-in-relationships.html "THE CLUES TO DETECTING FRAUD ARE HIDDEN IN RELATIONSHIPS") with new clients.

One thing is for sure, a holistic strategy provides the visibility necessary to better prepare for auditing and compliance requirements. It improves efficiency, protects the brand and reputation, and protects against sanctions or fines. There is greater [protection against identity theft and fraud from a customer](https://www.financedigest.com/id-fraud-is-on-the-rise-can-financial-services-do-more-to-protect-their-customers.html "ID fraud is on the rise: can financial services do more to protect their customers?") perspective, and fewer security incidents increase uptime, allowing customers seamless access to their financial lives.

**AI is powering the** [future of finance](https://www.financedigest.com/enterprise-automation-is-the-future-of-finance.html "Enterprise automation is the future of finance")

Artificial intelligence has taken the world by storm and the [financial services sector](https://www.financedigest.com/boom-or-bust-how-the-financial-services-sector-is-coping.html " Boom or Bust: how the financial services sector is coping") is no different. Investing in the right AI [technologies can see the industry reap the benefits](https://www.financedigest.com/the-benefits-of-adopting-cloud-technology-in-the-finance-industry.html "The benefits of adopting cloud technology in the finance industry") of a more secure and efficient organisation.

With AI-powered solutions for improving and monitoring business processes and intelligent document processing, financial [organisations can reduce manual steps](https://www.financedigest.com/6-steps-to-organising-an-introvert-friendly-networking-event.html "6 Steps to organising an introvert-friendly networking event ") required in the onboarding stage and automate both structured and unstructured documents. This enables them to have a birds-eye view of customer [data so that they can distinguish when activity](https://www.financedigest.com/why-finance-teams-need-to-go-beyond-numbers-to-an-active-relationship-with-data.html "Why finance teams need to go beyond numbers to an active relationship with data ") is suspicious and fraudulent.

By opening up visibility and reducing manual effort aided by AI, RPA, and NLP, the frontline [finance teams](https://www.financedigest.com/what-skills-and-areas-of-knowledge-should-finance-teams-develop-during-2023.html "What Skills and Areas of Knowledge Should Finance Teams Develop During 2023? ") can focus on protection and mitigation and create robust fraud detection and prevention systems. Evidently, there are a whole host of benefits that come when a financial institution achieves a holistic [fraud prevention strategy](https://www.financedigest.com/attacking-banking-and-fintech-fraud-head-on-through-ai-infused-strategies.html "Attacking Banking and Fintech Fraud Head-On Through AI-Infused Strategies "), free of limiting silos.

By taking new steps to [fraud](https://www.financedigest.com/cheque-fraud-figures-reach-record-low.html) prevention, risk through this lens requires more than technology investment. It’s the combined focus on people, processes, and content in the successful implementation of a holistic approach. Businesses [must think](https://www.financedigest.com/new-uk-pm-must-be-radical-to-stop-power-bill-catastrophe-think-tank.html "New UK PM must be radical to stop power bill catastrophe – think tank") strategically about AI and understand it’s impact to truly achieve fraud-free finance.


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