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Growth in digitalization has led to an increased risk of cybercrime
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Risk and compliance practices may fall short of global standards
More than half of the Middle East and North African (MENA) businesses face new financial crime risk challenges triggered by the pandemic, a new report by global data provider Refinitiv revealed.
The report titled ‘The Financial Crime in MENA 2021’ said 51 percent of respondents face new risk challenges; and for a quarter, a data breach poses the most significant risk.
About 34 percent cited problems associated with data management as the key reason for investing in technology.
Growth in digitalization has led to an increased risk of cybercrime, according to Refinitiv.
“COVID-19 put an enormous burden on the risk and compliance functions in a very short amount of time, said Phil Cotter, Global Head, Customer and 3rd Party Risk Solutions, Data and Analytics, Refinitiv.
“The rapid growth in digitalization during the pandemic has inevitably created opportunities for criminals and fraudsters.”
Cotter added that the risk and compliance functions across MENA “are now faced with the rapidly evolving threat of cybercrime, including payments fraud, account takeovers and identity theft.”
He called on business leaders to focus on these risk factors by deploying advanced technologies to tackle financial crime which will enhance compliance effectiveness and protect corporate reputation.
The survey suggested risk and compliance practices may fall short of global standards in areas such as third-party risk.
Only five percent of respondents focus on reporting ultimate beneficial ownership (UBO), while half of the respondents (49 percent) believe that crime prevention technologies will witness a significant upgrade in the next two years.
Less than one percent of respondents viewed environment, social and governance (ESG) issues as major concerns, while nearly half of the respondents (48 percent) reported a lack of corruption controls during a time of severe supply chain disruption.