This year marked the fifth iteration of FFECON, bringing together a diverse set of speakers to share insights on the new landscape of financial crime in 2022.
The Business of War: Inside the Global Arms Trade
Andrew Feinstein, Executive Director of Shadow World Investigations, Investigative Writer, Broadcaster, Researcher and Campaigner, gave a captivating talk on the most corrupt of all trades. The arms trade accounts for 40% of corruption in all global trade. Casting light on the highly secretive industry that operates under national security and whose bribes play a crucial role in financing political systems, Andrew discussed some of the far-reaching and devastating socio-economic costs. In order to combat this corruption stemming from the weapon industry, accountability, transparency, and awareness is badly needed — starting with exposure and simple legislation.
Friend or Foe: The Impact of Anti-Financial Crime on Human Rights
A riveting panel discussion led by Maya Braine, Managing Director, Head of Insights, FINTRAIL touched on the diverse ways anti-financial crime and anti-corruption measures impact human rights, with case-studies from Nigeria and Russia. From the exaggeration of terrorist financing risks in the non-profit sector and harsh applications of FATF’s Recommendation 8 to the problem of de-risking and its real-world consequences for humanitarian initiatives — panellists shared unique perspectives on the unintended consequences of anti-financial crime on human rights. Professional Evasion: The Impact of SWIFT Exclusion
Professional Evasion: The Impact of SWIFT Exclusion
Another panel discussion moderated by CEO of FINTRAIL Robert Evans looked at the hot topic of sanctions and SWIFT exclusion, focussing on Russia. Experts discussed the symbolic versus the real impact of the SWIFT ban and the legal frameworks versus the responsible business conduct approach. Speakers highlighted humanitarian challenges, the complexity of sanction avoidance and evasion, and the difficulties with implementing sectoral sanctions. Panellists also spoke about industry and operational impacts, with the unprecedented sanctions regimes diverting resources away from other areas of economic crime prevention and detection, the changing roles and responsibilities of transaction monitoring teams, staff burnout and broader industry collaboration.
The Tinder Swindler: A Victim Story
In a brave and compelling fireside chat with John-Paul Eaton, Global Community Director of FINTRAIL and Cecilie Fjellhøy, Fraud Victim of ‘The Tinder Swindler’ and Founder of action:reaction foundation, Cecile shared her touching story of being a victim of fraud and abuse. Recounting the different types of social engineering and manipulative tactics, including love bombing and fearmongering, Cecile shared how vital empathy is for financial institutions to detect this type of crime and help reveal the truth. All financial institutions should lead with empathy and compassion especially when investigating potential fraud.
The Crypto Conundrum: The Use of Privacy-Enhancing Tools
In a dynamic and diverse discussion between panellists led by Greg Wlodarczyk, Managing Director, Virtual Assets and New Payment Methods at FINTRAIL, experts debated legitimate and illegitimate uses for privacy-enhancing tools such as virtual currency mixers and privacy coins. While there are some valid reasons for using such tools in dangerous jurisdictions or for high net worth individuals who want to protect their identity, privacy tools like virtual currency mixers are considered risky as they are favoured by criminals and hackers. Panellists discussed that while a global ban on these tools is unlikely, there is vast importance in increasing knowledge and education and strengthening public-private partnerships in this space.
Does Identity Matter?
Moderated by Natasha Vernier, Co-founder and CEO of Cable, panellists discussed the concept and use of zero-proof identity and centralised versus decentralised solutions for digital IDs. In a context where consumers are becoming more conscious of the dangers of data breaches and awareness surrounding the types of personal information being shared, panellists emphasised the role of trust in the adoption of specific technologies and practices as well as the required legislative basis for reusable identities. Opportunities for financial inclusion were also discussed as digital identities may help the unbanked.
FinCrime Book Club
Author of Very Bad People: The Inside Story of the Fight Against the World’s Network of Corruption and founder of Global Witness, Patrick Alley, was interviewed by Ciara Aitchison, Director, Insights and Research at FINTRAIL. In a fascinating discussion, Patrick shared his story of how he first started his international NGO, emerging from exposing the funding of the war in Cambodia from the illegal forestry trade. Among riveting personal stories, Patrick emphasised how corruption erodes democracy and the importance of naming and shaming the ‘very bad people’ who cause suffering — highlighting that every single person can make an impact. As London is the centre of many of the enablers of corruption, there is a huge opportunity to turn things around and make system-wide change. Patrick also shared more recent work that Global Witness is doing to combat climate change and assist in the Ukraine war. Patrick’s book is a must-read for every anti-financial crime professional, undoubtedly igniting a passion for why anti-financial crime professionals do what they do.
With Great AI Power Comes Great FinCrime Responsibility!
Last but certainly not least was the engaging and jam-packed panellist discussion on artificial intelligence (AI) solutions in financial crime moderated by James Nurse, Managing Director of FINTRAIL. Panellists illuminated the different challenges and opportunities in AI and machine learning’s application, especially concerning bias. All speakers agreed that before implementing AI, organisations need to have their house in order — the data architecture, rule system, and overcoming data silos. Particular challenges for fintechs are working with sparse data sets that inevitably create biases and detrimental impacts on financial inclusion. Experts advocated for anti-financial crime professionals to work with data scientists, being involved in the model design process and asking critical questions. Explainability is not just important for regulators — being able to explain technology in layman’s terms is a marker of a good data culture. Additionally, having diverse teams encourages diversity of thought and better solutions throughout organisations!
This year’s conference highlighted:
An unsurprising but important recurring theme of partnerships between private and public and industry in more general terms. From unprecedented sanctions to new technologies in the crypto sector, creating channels for education and information sharing is vital to fight financial crime effectively.
Financial institutions must lead with empathy in all areas of their work, including the way teams deal with potential victims of fraud.
Exposure and awareness are vital. From naming and shaming corrupt leaders and behaviour, to openly discussing industries that are in the shadows like the global arms trade — each individual, especially anti-financial crime professionals, can make an impact on the fight against corruption and democracy.
Unintended consequences for human rights and artificial intelligence are essential to bringing to the fore in order to mitigate. From bias in machine learning systems that impact financial inclusion to de-risking of important humanitarian initiatives — we all have a duty to critically think about the ways in which anti-financial crime measures impact the most vulnerable.
All in all, the conference was a hit! We already can’t wait for the next one!
