NASDAQ: Banks Need Fintech Trust to Combat US$3tn in Fraud

NASDAQ has released its Global Financial Crime Report for 2024, which examines the state of financial crime today and its effect on the global financial system. 

Today, NASDAQ feels that impact is ‘profound’ after an estimated US$3.1tn in illicit funds flowed through the global economy in the past year alone. 

Money laundering was chief among fraudulent fund transfers, with trillions of dollars keeping destructive, criminal enterprises afloat.

Many banks are looking to new solutions such as artificial intelligence, data and analytics to help improve their financial crime efforts. 

While 62% of banks and financial services providers leverage intelligent document processing (IDP) and 50% have natural language processing (NLP) to help combat fraud, NASDAQ finds that only 44% of institutions leverage Robotic Process Automation (RPA) in their anti-fraud efforts, even less use machine learning (40%) and only 26% are employing Gen AI and Large Language Models (LLMs) to combat illicit money movement. 

Despite the low uptake for new technologies to help combat financial crime, NASDAQ expects 70% of banks and financial institutions globally to increase spending on AI and machine learning in the next two years. 

By doing so, these institutions will have a capacity 65% greater than what is currently in place to better detect fraud, and stem the tide of financial crime globally.

So, while the figures make for grim reading today, there is much hope for a future where financial crime is more robustly combatted and the money transfer avenues for fraudsters are greatly reduced.