Financial crime is growing in scale, sophistication and cost, and for regulated organisations, understanding the threat landscape has become a survival requirement rather than a box-ticking exercise.
According to ZIGRAM, financial crime covers nonviolent illegal acts committed for financial gain, spanning fraud, embezzlement, tax evasion and insider trading, alongside offences that move or conceal illicit proceeds, namely money laundering, terrorist financing and sanctions evasion.
ZIGRAM recently discussed types of financial crimes, key offences, trends, and how institutions can respond.
Though lacking the physicality of street crime, these offences can destabilise entire economies. According to UNODC, money laundering alone accounts for 2-5% of global GDP, amounting to hundreds of billions to over a trillion dollars annually. In 2022, 46% of organisations faced financial crime.
Legal frameworks such as the FATF Standards, EU AML Directives, the USA PATRIOT Act and the UK’s Proceeds of Crime Act define financial crime around abuse of financial systems, intentional deception and concealment.
Crimes rarely fit neatly into one box, as United States v. Atilla demonstrated, where transactions through Halkbank and front companies constituted bank fraud, sanctions evasion and money laundering simultaneously.
Fraud remains the most frequently encountered offence, spanning consumer scams, corporate fraud, healthcare fraud and Ponzi schemes. Bernie Madoff’s scheme caused roughly $65bn in reported losses, while Enron’s accounting fraud cost investors upwards of $74bn and triggered the Sarbanes-Oxley Act. In 2022, 18% of large companies lost over $50m to fraud.
Money laundering follows three stages: placement, layering and integration, with shell companies, trade-based laundering and virtual assets among the hardest typologies to detect.
The Danske Bank Estonia scandal exposed suspected laundering of over €200bn, and the US recorded 11,472 AML events over the past decade. Terrorist financing poses distinct challenges, as low transaction values and legitimate fund origins complicate tracking.
Corruption and bribery enforcement has intensified since 2015, with landmark cases including Brazil’s Operation Car Wash, Airbus’s $3.9bn multinational settlement in 2020, and HSBC’s 2026 charges in France over alleged embezzlement linked to a former Lebanese central bank head. Meanwhile, tax evasion, exposed at scale by the Panama, Paradise and Pandora Papers, frequently acts as a predicate offence to laundering.
Cyber-enabled crime is the fastest-growing category. AI-driven phishing scams cost US businesses $2.9bn in 2023, while a European crypto fraud ring recently stole around €600m before law enforcement intervened. Deepfakes, synthetic identities and AI-augmented social engineering feature among emerging threats, alongside ESG misstatements such as carbon credit fraud and greenwashing.
Regulators, including FATF, the EU’s new AML Authority, FinCEN, MAS and the FCA, are pushing risk-based approaches and technology adoption. Organisations spent between $5m and $25m on financial crime compliance in 2023, and IRS Criminal Investigation reported 94% of its cases used Bank Secrecy Act data.
Modern compliance frameworks combine customer due diligence, enhanced due diligence, sanctions and PEP screening, transaction monitoring, case management and adverse media screening, structured through the three lines of defence model.
RegTech firm ZIGRAM argues that traditional rule-only systems cannot keep pace, and its modular platform, spanning name screening, transaction monitoring, entity risk assessment and fraud monitoring, aims to give institutions a unified risk view across jurisdictions.
The firm advises compliance leaders to conduct gap analyses, define target operating models and pilot RegTech solutions, positioning financial crime compliance as a strategic advantage rather than a cost centre.
Read the full ZIGRAM post here.
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