Industry calls for ecosystem approach to financial fraud

Panelists at a webinar hosted with payments firm Ecommpay stated fraud should be treated as an ecosystem problem and called for coordinated regulatory reform, broader data sharing and standardised processes. Interpol describes financial fraud as one of the most serious transnational crimes and estimates AI-enhanced fraud is 4.5 times more profitable than older methods. Panelists noted criminals increasingly target human vulnerabilities and use AI to scale and personalise scams, making them harder to detect.

Panelists noted the current response is fragmented. Multiple regulators and oversight bodies hold partial responsibilities for fraud prevention, so no single authority has end-to-end oversight. Individual firms build their own detection tools, rules and reporting methods, creating inconsistent information flows across the industry.

Limited data sharing between companies and across borders weakens detection and investigation. Panelists identified legal and commercial barriers that prevent firms from exchanging suspicious-activity data. Privacy and data-protection laws, differing national rules on law enforcement access, competition rules and unclear liability can all restrict information exchange. Cross-border jurisdictional differences make it harder to trace funds or coordinate takedowns.

Panelists proposed several reforms to enable a systemic response without imposing one model on all businesses. Suggestions included a unified regulatory framework that sets common minimum standards for reporting and information exchange while allowing proportionality by firm size and risk profile. They also proposed legal safe harbors or limited liability protections to allow firms to share anonymised or matched threat indicators with peers and with law enforcement.

A central, non-profit platform to aggregate data and distribute actionable intelligence was offered as a possible mechanism to reduce duplication and speed responses. Panelists said standards for incident classification, required data fields, and alert scoring and escalation could make automated sharing and cross-checking easier and help smaller firms adopt common practices.

Panelists warned of trade-offs. A single standard could impose heavy costs on small businesses, create a single point of failure if a shared platform is compromised, and limit innovation if standards are too prescriptive. Faster data sharing can help stop fraud quickly but raises privacy and security concerns that regulators must address.

Recommendations included clear governance for any shared system, independent oversight, strict controls on how personal data is used and retained, and pilot programmes to test standard formats and sharing mechanisms before wider rollout.

The webinar featured Willem Wellinghoff, UK chair and chief compliance officer at Ecommpay. Teresa Connors served as moderator.