Global: CFIT Forms Coalition to Combat Economic Crime with Advanced Verification Methods

The Centre for Finance, Innovation, and Technology (CFIT) is spearheading a new coalition aimed at tackling economic crime through enhanced verification methods. By bringing together experts from various sectors, including finance, technology, policy, and academia, CFIT seeks to develop innovative solutions to detect fraud, protect small and medium-sized enterprises (SMEs), and bolster defenses against crimes such as Authorized Push Payment (APP) fraud.

The coalition will encompass digital ID providers, technology firms, trade associations, major and challenger banks, fintech companies, and credit agencies. While the complete list of partners has yet to be disclosed, these stakeholders will collaborate on data-driven research to verify the legitimacy and identity of businesses interacting with financial services.

Additionally, the coalition will address other security challenges in commerce and payments that affect UK businesses and consumers. CFIT’s goal is to demonstrate how combating financial crime can safeguard businesses and their customers, while enabling banks and fintech firms to reduce liability, save costs, and enhance customer experiences.

Initial concepts from the coalition are currently being tested with Citizens Advice and several retail banks, following a successful proof of concept with HSBC. The coalition will commence its activities immediately, with interim findings anticipated in Q4 2024 and a final report expected in early 2025.

CFIT’s CEO, Ezechi Britton MBE, underscored the significance of this initiative: “Economic crime is a major threat to the UK’s financial security, and it can have a profoundly distressing impact on consumers and businesses.

“At CFIT, we are committed to addressing this and making the financial services industry more robust by uniting the best minds across the sector and beyond to combat this pressing issue. This will be achieved through verifying UK businesses to fight economic crime. Our intention is to support the incoming Government and industry to put in place measures that will make financial services safer, and our economy even more resilient in the years to come.”

This initiative follows CFIT’s previous coalition on Open Finance, which highlighted the potential of data-sharing technology to improve financial outcomes for UK consumers and enhance access to finance for SMEs.

Martin McTague, national chair of the Federation of Small Businesses, emphasized the impact on small businesses: “Fraud exacts a huge toll on small businesses, and every effort must be made to tackle it so that customers can shop safely online and small firms can trade securely.

“Any proposed solution to fraud must take the needs of small businesses into account, in terms of how it can best protect them, and in terms of considering how to make it as simple as possible for them to integrate into their processes.”

Juniper Research estimates that global cumulative merchant losses to online fraud between 2023 and 2027 are expected to exceed $343 billion.