Friday's Final Word

In this edition, we tackle the latest in financial crime, rising fraud trends, insights from industry leaders, and global regulatory shake-ups—because in the world of financial crime, there’s never a dull (or honest) moment!

💸 TD Bank fined $3bn in historic money laundering settlement

👷 Employing AI fraud: Fake job applicants and fake employers

🛍️ Ecommerce fraud to exceed $107bn in 2029 

📻 Leaders in Finance Podcast: Live at the AML event

👮 How countries are navigating digital asset regulation 

TD Bank fined $3bn in historic money laundering settlement

TD Bank has pleaded guilty to criminal charges and agreed to pay a whopping $3 billion fine for allowing drug cartels and criminals to transfer hundreds of millions in illicit funds through its systems. The bank's compliance failures were so notorious that employees jokingly referred to TD's slogan - "America's most convenient bank" - as being marketed toward criminals, with one customer brazenly laundering $470 million in drug proceeds while bribing staff with gift cards. In a damning statement, Attorney General Merrick Garland didn't mince words: "By making its services convenient for criminals, TD Bank became one" - marking the largest lender in US history to plead guilty to Bank Secrecy Act violations and the first to admit conspiracy to commit money laundering.

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Employing AI fraud: Fake job applicants and fake employers

In a disturbing trend, employment scams have skyrocketed by 118% in 2023, with fraudsters wielding AI to orchestrate sophisticated schemes targeting both job seekers and employers. The FBI has reported an alarming rise in deepfake job applicants using manipulated video and audio during remote interviews, where "actions such as coughing, sneezing, or other auditory actions are not aligned with what is presented visually." On the flip side, scammers posing as recruiters have bilked unsuspecting job seekers out of $367 million through fake job listings designed to steal personal information - and that was before the recent explosion in generative AI technology.

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Ecommerce fraud to exceed $107bn in 2029 as deepfakes and ‘friendly fraud’ get more sophisticated

Ecommerce fraud is set to more than double to a staggering $107 billion by 2029, with AI-powered deepfakes and 'friendly fraud' leading the charge in sophisticated scams targeting online merchants. As fraudsters leverage AI to create synthetic identities and automate attacks at unprecedented scales, experts urge merchants to incorporate biometric identification and liveness detection into checkout processes to combat increasingly sophisticated fraud attempts. Meanwhile, even seemingly minor issues like confusing billing descriptors are costing UK merchants £128 million annually in chargebacks, highlighting how fraud threatens profitability from multiple angles in the evolving digital marketplace.

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Leaders in Finance Podcast: Live at the AML NL 2024 Event

Dive into the dark underbelly of finance with six heavy hitters in the financial crime world, including Deloitte's Head of Forensic & Financial Crime and a PhD-holding law lecturer, as they unpack the latest battlegrounds in the war against money laundering. This exclusive episode, recorded live at the AML NL 2024 Event, brings together top minds like Krik Gunning of Fourthline and other industry leaders to dissect emerging threats and cutting-edge defense strategies in the financial sector. For anyone fascinated by the cat-and-mouse game between criminals and compliance, this star-studded roundtable offers an insider's look at the future of financial crime fighting.

Listen to full podcast here

How different countries are navigating the uncertainty of digital asset regulation in a complex election year

The World Economic Forum's latest report, Digital Assets Regulation: Insights from Jurisdictional Approaches, highlights how countries are navigating the uncertain regulatory landscape of digital assets during a critical election year. Major regions like the EU, UK, and UAE are adopting varied strategies, with some focusing on strict Anti-Money Laundering (AML) and Know Your Customer (KYC) protocols—responding to the $100 billion laundered via crypto since 2019. Countries like Japan and Switzerland are balancing innovation with regulation, utilizing sandboxes and DeFi frameworks to address emerging risks. As digital assets continue evolving, global cooperation and agile policies are crucial for consumer protection and market stability.

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