Why financial crime compliance is crucial for your business

5 min

In today's globalised economy, financial crime is a growing threat, costing businesses betwe...

JCW Resourcing

By JCW Resourcing

In today's globalised economy, financial crime is a growing threat, costing businesses between $800 million to $2 trillion each year alone through money laundering. With rising threats, firms within the financial space must implement strong financial crime compliance processes and policies to protect their reputation, employees and customers. This process starts by hiring experts within the industry's leading financial crime compliance jobs.

In this guide, we'll outline why compliance is so important in financial services, the various compliance regulations for financial services and some of the top financial crime compliance jobs you should hire for if you want your business to remain compliant. But first, let's establish: what is financial crime and what is financial crime compliance?

What is financial crime?

Financial crime is a broad term encompassing various illegal activities involving the financial system. Some of the most common types of financial crime include:

  • Money laundering: Money laundering is the process of withholding the origins of illegally obtained money, using a complex web of transactions to make the finances appear as if they were obtained legally.
  • Terrorist financing: Terrorist financing involves providing financial support to terrorist groups to fund terrorist attacks.
  • Bribery and corruption: Bribery and corruption involve the offering, receiving, or soliciting of anything of value to influence unethical and illegal actions.
  • Market abuse: Market abuse can be broken down into three types; market manipulation, insider dealing and unlawful disclosure, and is the use of manipulative strategies to gain an unfair advantage in the financial markets.
  • Cybercrime: Cybercrime is the use of information technology to commit fraud, identity theft, and ransomware attacks.

What is financial crime compliance?

Financial crime compliance is processes overseen by governments and regulatory bodies to ensure an organisation meets internal and external standards, policies, laws and regulations that apply to its industry and business. These regulations include preventing, detecting, and deterring financial crimes such as bribery, corruption, money laundering, terrorist financing, and cybercrime.

Compliance in the financial services space is critical for businesses of all sizes and industries, as it helps to protect them from reputational damage, financial losses, and legal liability, as well as protecting a company's financial system from being exploited for criminal purposes.

Why is compliance important in financial services?

Financial crime compliance is important in financial services and for your business for many reasons, from helping to protect your customers and clients, investors and your overall financial system from financial crime, cyber-attacks, financial threats and market manipulation.

Additionally, financial compliance is essential for maintaining your business's public trust and reputation in the financial services industry. By following the rules and regulations, your business can demonstrate it is committed to ethical business practices and is working to protect your clients, customers, investors and the financial system. But what are the main compliance regulations for financial services? In the next section, we'll delve into this.

Compliance regulations for financial services

The UK's financial services industry is regulated by a number of bodies, most notably the Financial Conduct Authority (FCA), the Bank of England (BoE) and the Prudential Regulation Authority (PRA). 

  • Financial Conduct Authority (FCA): The FCA is the UK's independent financial regulator responsible for protecting consumers and ensuring the financial system is stable.
  • Bank of England (BoE): The Bank of England is the UK's central bank and oversees monetary policy, financial stability, and consumer protection.
  • Prudential Regulation Authority (PRA): The PRA is the UK's bank regulator and is in place to ensure banks and other financial institutions are stable and can withstand economic shocks.

These bodies work together to ensure that the financial services industry complies with all applicable regulations and provide guidance and support to financial services businesses to help them comply with the rules.

Collectively, these bodies are responsible for ensuring that financial services businesses comply with a wide range of regulations, including:

  • Anti-money laundering (AML): AML regulations are in place to stop criminals from exploiting the financial system to launder money. These regulations require institutions in the economic space to identify and verify their customers and report suspicious activity.
  • Know your customer (KYC): KYC regulations are similar to AML regulations but focus on ensuring financial businesses know and can identify who their clients are. This regulation requires organisations to collate and verify customer information, including their names, address, and date of birth.
  • Sanctions compliance regulations: Sanctions compliance regulations prohibit businesses from doing business with individuals or entities designated by the government as sanctioned and are in place to prevent companies from being used to support sanctioned individuals or entities.
  • Trading regulations: This regulation governs how financial institutions can trade securities and other financial instruments and are designed to prevent market manipulation and help to protect investors.
  • Accounting standards: Accounting standards govern how financial institutions account for their transactions, helping to ensure that financial statements are accurate and transparent.
  • Auditing requirements: Auditing requirements are a regulation that governs how financial institutions are audited, ensuring that financial statements are accurate and that the financial institution complies with all applicable regulations.
  • Data protection regulations: Data protection regulations, like GDPR, govern how financial institutions collect, store, and use customer data. These regulations are designed to protect customer privacy and prevent the misuse of customer data.
  • Consumer protection regulations: Consumer protection regulations help ensure consumers are treated fairly and not taken advantage of by financial institutions, protecting customers from deceptive, unfair or abusive practices. 

These are just some of the UK's most important compliance regulations for financial services. Organisations operating in the financial services industry must comply with all applicable regulations to protect their customers, their businesses, and the financial system as a whole.

5 financial crime compliance jobs you should hire for

If you're a financial institution, it's essential that you have a strong financial compliance team to implement financial processes to protect your business from financial crime. Your team should include an array of dedicated financial crime compliance professionals who are responsible for implementing and monitoring your organisation's financial crime compliance policies and procedures.

So, if you’re looking to optimise the financial compliance of your business, here are 5 financial crime compliance jobs you should hire for.

Chief Compliance Officer

Chief Compliance Officers (CCO) oversee organisational compliance, ensuring a business complies with the necessary laws, regulatory requirements, policies, and procedures. The CCO is a senior management team member and reports to the CEO.

Responsibilities of a Chief Compliance Officer include:

  • Oversee the development and implementation of the organisation's compliance procedures
  • Conduct risk assessments and identify areas where the business is at risk of non-compliance
  • Develop and implement remediation plans to address areas of non-compliance
  • Monitor and enforce compliance with laws, regulations, policies, and procedures
  • Investigate compliance incidents and take appropriate action
  • Report on compliance to the CEO and other senior management
  • Represent the organisation to regulators and other external stakeholders

Financial Crime Compliance Officer

A Financial Crime Compliance Officer (FCCO) ensures that an organisation complies with all applicable financial crime laws and regulations. These regulations include anti-money laundering (AML), counter-terrorist financing (CTF), and sanctions compliance. An FCCO typically reports to the Chief Compliance Officer (CCO) or another senior compliance officer.

Responsibilities of a Financial Crime Compliance Officer include:

  • Developing and implementing financial crime compliance policies and procedures
  • performing risk assessments and identifying financial crime risks
  • Investigating suspicious activity reports (SARs)
  • Providing advice and guidance to employees on financial crime compliance issues
  • Monitoring compliance with financial crime laws and regulations
  • Managing a businesses financial crime compliance team
  • Liaising with regulators and law enforcement

Anti-Bribery and Corruption Officer

An Anti-Bribery and Corruption Officer (ABC Officer) leads and manages the organisation's anti-bribery and corruption (ABC) compliance process. From developing and implementing ABC policies and procedures, conducting risk assessments, and investigating allegations of ABC misconduct, the ABC Officer also advises and guides employees on ABC compliance issues.

Responsibilities of an Anti-Bribery and Corruption Officer include:

  • Develop and implement anti-bribery and corruption (ABC) policies and procedures
  • Carry out risk assessments and identify ABC risks
  • Investigate and report on allegations of ABC misconduct
  • Provide advice and guidance to employees on ABC compliance issues
  • Liaise with external stakeholders, such as regulators and law enforcement
  • Monitor compliance with ABC laws and regulations
  • Stay up-to-date on the latest ABC trends and best practices

Fraud Analyst

Fraud Analysts are responsible for identifying and investigating fraudulent activity within the organisation, including analysing data, conducting research, and developing and implementing fraud prevention strategies. The Fraud Analyst also works with other departments to protect the organisation from fraud.

Responsibilities of a Fraud Analyst include:

  • Identify and investigate fraudulent activity within an organisation
  • Analyse data to identify trends and patterns in the financial services industry
  • Develop and implement fraud prevention strategies
  • Work with other departments, such as the IT department, to protect the business from fraud
  • Provide training to employees on fraud prevention
  • Stay up-to-date on fraud trends and best practices

Money Laundering Reporting Officer

Money Laundering Reporting Officers (MLRO) ensure the organisation complies with all applicable anti-money laundering (AML) laws and regulations. Their role involves developing and implementing AML policies and procedures, conducting risk assessments, and investigating suspicious activity reports (SARs). An MLRO also provides advice and guidance to employees on AML compliance issues.

Responsibilities of a Money Laundering Reporting Officer include:

  • Create AML policies and procedures
  • Identify AML risks by performing risk assessments 
  • Investigate SARs and take appropriate action
  • Provide advice and guidance to employees on AML compliance issues
  • Monitor compliance with AML laws and regulations
  • Liaise with external stakeholders, such as regulators and law enforcement

Final thoughts

Financial crime compliance is an essential part of doing business in today's world. By implementing a solid financial crime compliance process and hiring the financial crime consultants we've outlined above, your business can better protect itself from financial harm, regulatory fines, and reputational damage.

Looking for Financial Crime Compliance Recruitment support?

If you're a business within the legal and financial services sector looking for industry experts to perfect your financial crime compliance strategies and procedures, we can help. Our compliance recruitment specialists have deep financial market knowledge and access to an unbeatable network of global candidates to help your business find the best talent.

Discover how we can support your recruitment needs by getting in touch with a member of our team today.