Data Management
Cybersecurity Europe Fintech Ecosystems

Consolidated European Data Initiative to Stamp Out Fraud and Financial Crime

Driving efficiency improvements in the collaborative detection of fraud and financial crime is a central aim of a new Gaia-X related project led by Atos – one its founding members.

Gaia-X is a European initiative championing data sovereignty, and digital transformation aiming to develop a federation of data infrastructure in Europe and beyond.

With between 2 per cent and 5 per cent of global GDP (€1.7 – €4trillion) estimated to be laundered annually, the Federated Detection of Fraud and Financial Crime project is central to broader efforts implementing Gaia-X policies and architecture to build a secure and transparent data and cloud hub for member states, companies, and citizens.

The recognised capabilities of Atos in establishing innovation ecosystems alongside technological orchestration will be utilised as the programme aims to create a cross-company and cross-border service and collaboration ecosystem to improve Anti-Fraud and Anti-Financial-Crime (AFC) and transparency over money and value flows.

Priority will be given to reducing the high proportion of false-positive transaction alerts and improving the detection of fraud and financial crime by sharing and analysing information between participants. Efforts up to now have focused on tackling this challenge at an organisational level.

Organizations and businesses beyond the European Union in other parts of the globe could also benefit from the Federated Detection of Fraud and Financial Crime project, says Carol Houle, SVP, Global Head of Financial Services and Insurance for Atos:

Carol Houle, SVP, Global Head of Financial Services and Insurance for Atos
Carol Houle

“Given that the majority of global transaction alerts are false positives, with each alert needing to be individually investigated, this remains a resource-intensive and costly matter that only a coordinated, cross-border response can address. Reimagining the end-to-end business value stream approach for the detection of fraud and financial crime, bringing the best data sharing, data analytics and high-performance-computing technologies together will help the banking industry to bring anti-money laundering costs down. Additionally, this will allow the public sector to combat such crime more effectively, ultimately benefiting the end customer.”

As the EU commissioner for financial services, Mairead McGuinness, has acknowledged: “Money laundering poses a clear and present threat to citizens, democratic institutions and the financial system.”

Transactions involving ‘dirty’ money account for about 1.5 per cent of GDP in the EU; around €133billion ($157billion). “The scale of the problem cannot be underestimated, and the loopholes that criminals can exploit need to be closed,” McGuinness is on record as saying.

The project, within the EuroDaT consortium, is also in preparation for the ambitious package of legislative changes to strengthen the EU’s anti-money laundering and counter-terrorism financing rules by the European Commission, which includes the creation of a new EU authority to fight money laundering.

Succeeding in the aims of the project could also benefit insurance companies by helping to detect cross-insurance companies double use of claim documentation in real-time – which is not currently standard practice, and which could contribute to a holistic fraud detection structure, leading to improved profits and a more positive image of insurers to customers.

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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