Financial crime investigations: Levelling up

Written by James Thomas on Monday 31 July, 2023

Investigation skills are an essential asset in the fight against financial crime. The recent UK National Fraud Strategy illustrates this clearly. The UK government hopes to reduce fraud and cybercrime by 10% by 2025 and the creation of a new National Fraud Squad, including over 400 new specialist investigator roles, is central to its plans.

Of course, the problem of financial crime is not confined to the UK and similar responses to addressing it are being taken elsewhere. For example, the Canadian government is currently committed to developing a new Canadian Financial Crimes Agency (CFCA),[1] which will be the lead enforcement body for investigating complex financial crimes.

Nor is the response restricted to the public sector. As the strategy itself notes:

70% of fraud experienced by UK victims could have an international component – either offenders in the UK and overseas working together, or fraud being driven solely by a fraudster based outside the UK.[2]

This reinforces the need for both international and public-private sector collaboration in the fight against financial crime, including through improved data and intelligence sharing arrangements. Europol, with its emphasis on data and intelligence sharing across borders, and its explicit aim of supporting law enforcement,[3] is an excellent example of the utility of collaboration.

Joining the dots

In this context, the drive towards upskilling in the field of investigations is not exclusive to the law enforcement and intelligence communities. Investigations knowledge and expertise amongst those working within industry will also become an increasingly valued commodity not only to counter the threat to businesses and their customers from internal and external criminal activities, but also to manage the growing complexity of investigations, and to facilitate improved working relationships with external agencies and police forces.

The success of public-private partnerships relies on ‘joining the dots’. Parties on either side require an understanding of both the mechanics of an investigation and the workings of financial crime within a financial services context. This enables those in the public and private sectors to speak a common language, facilitating the ‘whole system response’ to tackling financial crime, as described for example within the UK’s Economic Crime Plan.

Meeting the need

In the face of evolving financial crime risk, it’s important that practitioners in monitoring or investigatory roles maintain a clear and up-to-date understanding of what financial investigations entail and they should be fully versed in the mechanics of an investigation and the tools available to conduct one, if necessary.

This includes knowing how to make an initial evaluation of a case to determine whether further investigation is required and being familiar with internal and external sources of information available to support such an investigation (as well as the powers required and procedures to follow to obtain that information). They should be fluent in how to perform effective open-source searches to obtain relevant external data, narrow the scope of inquiry, and reduce wasted time and resources. Further, with the massive increase in data in the digital age, both crimes and the resulting investigations can be increasingly lengthy and complex. Therefore, conducting an effective investigation now requires the ability to organise and manage huge volumes of data.

Practitioners can further distinguish themselves by developing the skills needed to conduct an interview with a witness or suspect; to properly record, analyse and document all evidence gathered; and to be able to compile internal and external reports on the outputs of any investigation.

In many organisations, such knowledge and skills may be developed entirely on the job, without specific or ongoing training. The shortcomings of this approach are clear in terms of missed opportunities to draw on best practice, to keep up-to-date with the latest developments, or to put such skills into practice within a ‘safe’ classroom environment. In the workplace, such shortcomings could mean either that examples worthy of further investigation ‘fall through the cracks’ or that significant inefficiencies are introduced where staff lack the skills to properly assess and triage cases to determine those worth actioning.

A practical focus

If the issues discussed in this article are relevant to you or your team, you might be interested in ICA’s new course, ICA Certified Financial Crime Investigator. With a strong vocational focus, and aimed at existing, new and aspiring financial crime investigators, including those reviewing suspicious activity reports, the course provides practical guidance on the application of investigations skills, including:

• how to identify and understand risk indicators 
• how to evaluate and triage initial reports, and 
• how to plan and execute effective investigations.

For more information, take a look at the ICA Certified Financial Crime Investigator course.