With almost two in five (37%) Australians admitting to having been scammed or knowing someone who has fraud detection and identity verification has never been more important for Australian businesses.
In 2020, cybercriminals stole $850 million from consumers, with some two-thirds of Australians dealing with an attempted scam each week. In addition, serious and organised crime in Australia was worth $24 to $60 billion between 2020 and 2021.
Despite rising threats, Australian organisations struggle to identify an efficient mix of corporate risk-management and compliance measures that do not detract from the customer’s online experience. According to industry leaders, the complexity of reducing corporate risk while meeting regulatory responsibilities can make or break the fight against financial crime and must be considered on par with reducing friction to meet constantly rising customer experience expectations.
Global data, analytics and technology company, Equifax brought together a panel of experts to discuss how organisations can better build and maintain a strong risk management culture, adopt best practice risk management approaches, and satisfy customer expectations.
General Manager of Identity, Fraud & AML, Equifax A/NZ, Tehani Legeay, says it is essential that all businesses come together with the common goal of protecting Australian consumers from the risk of financial fraud.
“One thing we all agree on is that the fight against financial crime is one worth fighting,” she said.
“As such, when there is an opportunity for us to work together for the greater good, that is an opportunity we should grab with both hands.
“It is critical that in our app-driven, digital world companies do all in their power to avoid the risk of fraud, money-laundering and terrorist financing – all three of which pose a real and significant threat to Australian consumers and business.”
Some of the country’s top fraud, AML and ID verification experts joined Equifax’s panel discussion, including Richard Bunting, AUSTRAC Principal Specialist of Education, Capability and Communications Branch; Ronald Daliya, Financial Crime Capability Lead, Insync; and Todd Harland, a banking industry expert on financial crimes risk and compliance, and CEO of AML Solutions International. It was facilitated by Tehani Legeay.
The panel agreed that even within a single organisation, implementing a quality AML program is often administratively difficult and can lead to internal friction. As a result, Australian businesses may be tempted to adopt a ‘one size fits all’ approach, leaving themselves, their partners, and consumers open to financial fraud, regulatory noncompliance and other adverse outcomes.
Richard Bunting, AUSTRAC Principal Specialist, says collaboration between regulators and industry is also critical in the battle against financial crime.
“AUSTRAC continues to work with industry sectors to consult on and provide guidance that reduces complexity and delivers greater clarity and certainty regarding AML/CTF obligations,” he said.
“Your AML/CTF program is an evergreen document and the work of board and senior management is intrinsic to staying on top of the challenges. It’s a constant theme and you will continue to hear a lot from AUSTRAC about governance.
“Proportionality is key. That means aligning your AML/CTF response – including any technological solutions, governance, and your systems and controls – to the level of assessed risk.”
Key outtakes from the roundtable have been captured in Equifax’s latest Red Paper (white paper), Acquisition vs Verification: A fine balance for Fraud, ID and AML risk management. It provides recommendations for employing effective compliance methods and protecting business, including building a compliance culture, implementing a target operating model, and training customers to better understand the importance of risk mitigation measures for their own financial safety.
The launch of this Red Paper shines a spotlight on the growing urgency for greater education for businesses on the art and science of balancing AML/CTF with the customer experience. Ultimately, an intelligent focus on technology, governance, culture and customer education will help companies balance compliance and the customer experience, the benefits being enhanced customer data and protection for brand and reputation.
