George Robbins UK General Manager & Director BAE Systems Detica

According to a survey from Detica NetReveal a business division of BAE Systems Detica, investment in managing financial crime and compliance remains a high priority, with a significant uptick in planned expenditure for 2013.[1]

Fraud management is a key area with 86% of respondents forecasting budget growth (compared to 45% in 2012 and 47% in 2011) and highlighting the application process, payments, the online channel and insider fraud as priority areas of focus. For anti-money laundering (AML), 84% expected increased budget in 2013 (compared to 34% in 2012 and 38% in 2011) but many organizations are still grappling with the effectiveness of automated detection systems. 

Financial institutions are also reacting to impending legislation such as the Foreign Account Tax Compliance Act (Fatca), although 44% of respondents are still evaluating the impact of the legislation, and recent regulatory enforcements which registered record fines for Tier 1 financial institutions in 2012.

The outlook for continued investment in financial crime detection and prevention remains positive for 2013, with anticipated annual growth well in excess of previous years. On average 83% of respondents expect an increase in their financial crime and compliance budgets, compared with 42% in both 2011 and 2010. Cross industry data sharing is becoming more common place with just less than 50% of respondents operating some kind of data sharing scheme but privacy laws and data protection are often cited as a barrier to data sharing.

“As the financial services industry stabilizes, we are seeing strong evidence of investment catch-up, with financial institutions increasingly recognizing the power of advanced technology to identify and prevent fraud." said George Robbins, UK General Manager & Director, Detica NetReveal. He continued, "Regulatory pressures continue to drive compliance budgets, along with new challenges such as Fatca now firmly on the horizon and generating new waves of activity.”

Detica NetReveal is a leading provider of risk, fraud and compliance solutions to a wide range of financial services and government clients across the globe. The NetReveal suite of solutions combines predictive analytics with advanced social network analysis to identify suspicious behaviors more accurately than other solutions.

BAE Systems Detica delivers information intelligence solutions to government and commercial customers. We help them collect, exploit and manage data so they can deliver critical business services more effectively and economically. We also develop solutions to strengthen national security and resilience.

Detica is part of BAE Systems, a global defense and security company with approximately 100,000 employees worldwide. BAE Systems delivers a full range of products and services for air, land and naval forces, as well as advanced electronics, security, information technology solutions and customer support services.           

[1] Operational Risk & Regulation and Detica NetReveal Financial Crime Survey 2012.  A global survey of 132 senior executives from financial institutions worldwide.