About a-team Marketing Services

A-Team Insight Blogs

Regulated Firms that Don’t Trust Electronic Identification Verification Risk Financial Crime

Subscribe to our newsletter

More than 36% of people in regulated firms who ‘can’t trust’ electronic identity verification technology and instead rely on manual checks are leaving their doors open to financial crime, according to research by anti-money laundering specialist SmartSearch.

This statistic, from SmartSearch’s 2023 annual survey of 500 compliance stakeholders across financial, accountancy, property and legal services, has doubled since the company’s 2022 survey, when 18% percent of people said they couldn’t trust the technology.

Focusing on the financial services sector, the survey shows 40% of compliance stakeholders can’t trust electronic ID verification technology.

“This indicates a significant dip in trust in electronic ID verification technology, despite its recommendation as part of the due diligence process in the Money Laundering and Terrorist Finance Act 2020,” says Fraser Mitchell, technical director at SmartSearch. “Many regulated firms may be unaware of this advice, hence the mistrust. Meantime, criminal gangs are washing billions through the UK’s financial systems. It’s a real concern.”

Looking at manual methods of identification, 87% of survey respondents in regulated firms are naively confident that they could identify a fake document such as a passport, driving licence or utility bill. Looking at the financial sector, the research shows 95% of people believing they could manually spot a fake ID, despite forgery risks.

Nicola Gifford, general counsel at SmartSearch, comments: “This is our third Electronic Verification Uncovered campaign. Our objective is to address common misconceptions among regulated firms, with a view to lowering the barrier to businesses adopting electronic verification as standard practice.”

Subscribe to our newsletter

Related content

WEBINAR

Recorded Webinar: Effective due diligence, screening and monitoring to mitigate financial crime risk

Managing financial crime risk requires a comprehensive approach to due diligence, screening, and continuous monitoring. Financial institutions face increasing regulatory scrutiny and staying compliant in today’s dynamic environment requires advanced technologies. Failure to comply is resulting in severe enforcement penalties. This webinar will explore practical strategies and tools for mitigating financial crime risk, focusing on...

BLOG

Managing Cognitive Dissonance in Regulatory Compliance with Corlytics

This past 18 months has been a time of significant growth for RegTech consolidator Corlytics. RegTech Insight recently spoke with founder and CEO John Byrne to delve into the Corlytics backstory and learn more about the company’s development. Corlytics is Byrne’s fourth company. He describes how, after the 2018 financial crisis, experiences at his prior...

EVENT

RegTech Summit London

Now in its 8th year, the RegTech Summit in London will bring together the RegTech ecosystem to explore how the European capital markets financial industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

Regulatory Data Handbook 2024 – Twelfth Edition

Welcome to the twelfth edition of A-Team Group’s Regulatory Data Handbook, a unique and useful guide to capital markets regulation, regulatory change and the data and data management requirements of compliance. The handbook covers regulation in Europe, the UK, US and Asia-Pacific. This edition of the handbook includes a detailed review of acts, plans and...