Financial Crime

Cases of financial crime have been on the increase in the past thirty years. It has of late become a major concern of the many governments throughout the world. This is because many financial crimes have a far-reaching effect on both the economy and security of any nation. Financial crimes are a significant threat to the development and stability of a countries economy. There are many forms of financial crimes but all constitute to the same crime and have same impacts on the affected nation. The definition of financial crime is the acquisition of property that is not yours in an unlawful manner for some financial gain.

Link with terrorist financing

The main types of financial crimes involve money laundering, bribery, electronic crime, fraud and information security. All these crimes are potential of helping terrorists in executing crime and attacks. Terrorists want to have their tracks covered. They will, therefore, look for means that will assist them in achieving their goals without getting noticed. Most of the criminal and terror groups are not financially stable. Besides that, terrorism requires a lot of money. They, therefore, use many of the above-named methods to get money to pull their dirty jobs. They are also keen to cover their tracks and thus their financiers will wire money to them using sophisticated online money transfers that will be hard to trace. In most cases, they use legitimate businesses that are hard to suspect. This leads to abuse of most of the charities and non-governmental organizations. Since terrorist groups get funds from all over the world and from many different sources, they hire the expertise of many professionals including bankers and lawyers. The availability of many money transfer products throughout the world makes it easy to funds from one jurisdiction to another without arousing suspicion.

How can firms react to fraud?

The major involved firms are the financial institutions and the legitimate non-governmental organizations. The first way they can deal with financial crimes is by taking the time to follow on any suspicious transaction. In fact, they should not take chances and should report any suspicious activity to the authority for investigation. Sometimes the terrorist groups will use innocent customers to carry out fraud activities on their behalf. Financial institutions should, therefore, take it as their obligation to offer financial assistance to customers to avoid them being taken advantage of. Institutions should also motivate their staff to be honest and blow the whistle in case of any suspicious activity.


© All rights reserved. Free access to professional guides