Due to an increase in fraudulent transactions, the cost of fraud in the Asia Pacific (APAC) area increased to 3.51 and 3.87 times the amount of actual lost transaction values last year. These numbers, which come from LexisNexis Risk Solutions’ True Cost of Fraud Study for the Philippines in 2020, show a considerable increase from the regional average of 3.40 in 2019.
Insurance, banking, and financial technology (fintech) companies have all upgraded their financial crime compliance systems as a result of the trend. “Last year alone, the entire expected cost of financial crime compliance across all financial firms in the Philippines was $690 million, or an estimated Php35 billion,” said Bharath Vellore, managing director for APAC at LexisNexis Risk Solutions. This equates to a 44 percent increase in the total expected cost of financial crime compliance across all financial institutions.”
LexisNexis Risk Solutions is a global pioneer in merging advanced analytics and global identity intelligence with cutting-edge financial crime technologies such as machine learning, artificial intelligence (AI), and robotic process automation (RPA). These solutions provide customers with a precise risk perspective throughout their customer lifecycle, allowing them to make prompt and correct decisions and mitigate financial crime risk.
LexisNexis Risk Solutions Philippines country manager Vishal Taneja encouraged dialogue on regtech within the insurance industry, pointing out that “for businesses to raise the bar in financial crime compliance, the 3 E’s (effectiveness, efficiency and explainability) of the Money Laundering and the Terrorism Financing Prevention Programme should be considered.”
Innovations like regtech can become part of mainstream industry operations as their leaders realize the extent of the damage that can be caused by complicity with the perpetrators of financial crime, no matter how unwitting or unintentional. As Maclang stressed, “The role of governance has never been so important. It’s now no longer just the responsibility of a CTO. This is now an enterprise objective and an enterprise task.”