Over the last 30 years, financial crime has increasingly become a concern to governments around the world. Today, there is widespread recognition that economically motivated crime poses a long-term threat to the stability and development of societies’ economies over the long run. The complexity and multinational nature of financial crime make it difficult for authorities and institutions to identify, measure, and remediate it. As a result, financial crime remains one of the most significant systemic risks in the global economy. Financial Crime Prevention Software

A new study from Juniper Research has found that global software spending on financial crime prevention tools will exceed $28.7 billion by 2027, increasing from $22.1 billion in 2023. It predicted that this growth of 30% will be driven by cybercriminals’ strategies of targeting the ever-growing transaction volume of payments over digital channels to maximize financial gain.

Regulations such as the EU Fourth Anti-Money Laundering Directive reflect the concern of regulators over these illicit activities. Due to the focus on financial crime, large fines have also been incurred by banks, as well as corporations.
Financial crime today uses a variety of techniques, including AI-powered phishing schemes that use complex online profiles to reach and message individuals more efficiently and deceive them into supplying personally identifiable information or clicking corrupted links.

Additionally, fraudsters increasingly use advanced computing and AI techniques to carry out advanced financial crimes. The emergence of enhanced malware is also on the rise. Criminals are increasingly relying on AI to determine whether a device is being operated by a person or by a machine, as cyber defenses improve at identifying and defending against malware.

Furthermore, criminal activities based on blockchain are on the rise. As blockchain is both decentralised and anonymized, it is extremely difficult to identify the person behind the activity. Economic crime has been transformed by the development of cryptocurrencies, which make it possible to store and transmit value anonymously or pseudonymously. Taking advantage of this environment, criminals can more easily carry out illegal activities, including money laundering. Technology is both a vector for crime and a tool for creating tremendous value and protecting it from financial criminals. Since people have more access to information online, financial crime has become more accessible. There is no set stereotype of financial criminals anymore, with the situation being that anyone with Internet access can pose a threat. In some cases, hackers simply view hacking as a challenge with unintended consequences.

Financial crime prevention software enables financial institutions and merchants to automate fraud detection monitoring, KYC (Know Your Customer) and KYB (Know Your Business) procedures, and behavioural analytics to mitigate the risk of financial crime.

The research assessed leading financial crime prevention software platforms and evaluated them on a number of criteria, including depth and breadth of offerings, service innovation, and future prospects, providing an extensive analysis of the competitive landscape in this dynamic market.

The Competitor Leaderboard ranked the three leading vendors as follows:

– FICO
– LexisNexis Risk Solutions
– Verafin

Research co-author Mélissa Amouny explained further: “FICO demonstrates a broad set of capabilities, access to high-value data for crime mitigation, and impressive AI-based analytical systems within its product portfolio. Competing vendors must prioritize frequent platform updates to keep pace with rapid cybercriminal innovations and maximise their market share.”

Fraud Detection and KYC Leading Software Spend Financial Crime Prevention Software

The research predicted that by 2027, fraud detection and KYC systems will account for 88% of global financial crime prevention spending; enabling financial institutions to improve the mitigation of many common crime types, including account takeovers. However, as digital payments increase in popularity and omnichannel experiences become commonplace, providing comprehensive financial crime prevention packages is becoming more complex, given the number of payment platforms and processes involved.

In response, the report urged financial crime prevention tool vendors to use AI for intelligent verification system orchestration, enabling enterprises to adapt to increasingly complex cyberattacks, choosing the right verification capability for each scenario.

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