FFIS Report: Regulators Must Take a More Proactive Approach to Encourage Private-Sector Collaboration in the Fight Against Fraud
As part of its continued investment in research and public sector education, Financial Network Analytics (FNA) recently contributed to a pivotal new policy discussion paper from the Future of Financial Intelligence Sharing (FFIS) program, a research partnership with the RUSI Centre for Financial Crime & Security Studies. It emphasizes the urgent need for supervisors and policymakers to actively support private-sector collaboration in the fight against economic crime.
The report, ‘A New Era of Private Sector Collaboration to Detect Economic Crime’, examines key legislative developments between 2023 and 2024 that have enabled—or will enable—financial institutions and other stakeholders to share intelligence to fight fraud and money laundering.
The Imperative for Enhanced Data-Sharing Protocols
While voluntary information-sharing frameworks are becoming more common, the report argues that supervisors and policymakers must take an active role in fostering private-sector collaboration. Enhanced data-sharing protocols are crucial to ensuring that critical fraud prevention data can be shared more widely, safely, and securely.
Understanding the scam and fraud difference underscores why this is necessary. Modern scams increasingly rely on authorized manipulation rather than simple unauthorized access. Because these illicit funds move rapidly across multiple payment systems, isolated, institution-by-institution monitoring is no longer sufficient.
The report provides a comprehensive overview of how legislative frameworks have been strengthened to facilitate both domestic and cross-border information sharing. It offers policymakers, supervisors, and industry leaders a valuable resource for ensuring that regulations support innovation in payment fraud detection while vigorously safeguarding consumers.
The Malaysian Success Story: A Blueprint for National Defense
As a practical example of what these collaborative frameworks can achieve, the paper highlights Malaysia’s National Fraud Portal.
Despite the absence of an explicit AML P2P information-sharing legal framework, Bank Negara Malaysia (BNM) and Payments Network Malaysia (PayNet) launched the National Fraud Portal (NFP) in April 2024. Working in partnership with FNA, the portal leverages the national payments infrastructure to deploy FNA’s Money Trails, supporting automated, cross-bank fund tracing and recovery in real time.
The NFP has significantly improved Malaysia’s response to fraud and scams. As of November 2024, the implementation of this shared utility has driven extraordinary results:
Massive Increase in Frozen Funds: The rate of fraud-risk funds being successfully frozen increased from 0.5% to 30%.
Rapid Case Resolution: The average time required to investigate each fraud case was reduced by 70%, dropping to just 30 minutes.
Unlocking the Power of Financial Network Analytics
Fostering collaboration and data sharing is crucial to the development of advanced technical solutions like the National Fraud Portal. This infrastructure offers jurisdictions the unprecedented ability to track cross-bank payments in real-time, detect mule activity, and apply sophisticated risk scores to payments.
By leveraging advanced financial network analytics, these platforms accelerate the detection, investigation, and prevention of financial crime. The overwhelming success of the NFP in Malaysia demonstrates the vast possibilities that enhanced data-sharing protocols can offer in the deployment of innovative, technological solutions to combat economic crime.
Read the full report sponsored by FNA, Swift, Mastercard, Deloitte, HSBC, and Nasdaq Verafin here: A New Era of Private Sector Collaboration to Detect Economic Crime
Learn more about how FNA is combating fraud and scams through national infrastructure: Explore FNA's National Fraud Portals
