UK Banks Collaborate with NCA in Major Anti-Financial Crime Initiative

In a groundbreaking initiative, seven major UK banks, including Barclays, NatWest, and Lloyds, have begun sharing financial crime data with the National Crime Agency (NCA) in what is being hailed as the largest project of its kind globally. Announced today (Friday), this collaborative effort aims to tackle money laundering and other forms of financial crime, having gone live in May, one year after its proposal by AML Intelligence.

The participating banks, which also include Santander, TSB, Metro Bank, and Starling Bank, are part of a voluntary data-sharing project that will run until October. As part of the initiative, bank staff have been seconded to the NCA, forming a team of 15 to 20 intelligence officers, data scientists, and analysts dedicated to investigating suspicious financial movements while ensuring legitimate customers are unaffected.

This project has already uncovered eight new crime networks potentially exploiting the financial system. Adrian Searle, director of the NCA’s National Economic Crime Centre, stated today, “The NCA and its banking partners have designed the data-sharing principles to ensure that only account data with multiple clear indicators of economic crime is included. The data provided by banking sector partners only includes information on customers (people or businesses) that meet a set of markers which are indicative of potential criminal behaviour. The volume of accounts identified represents a very small fraction of the UK total.”

Following Russia’s 2022 invasion of Ukraine, which highlighted how kleptocrats and criminals use the UK as a haven for laundering and hiding illicit funds, Britain has intensified its efforts to combat economic crime, which lawmakers estimate costs the economy up to £350 billion annually.

Mr. Searle disclosed that three crime networks have been referred to the NCA’s intelligence division for further investigation, and new intelligence linked to 10 of the agency’s largest investigations has been uncovered. “The fundamental purpose is to bring together the collective efforts of law enforcement, government, regulators, and the private sector to combat economic crime,” Searle said. He emphasized that criminals can currently exploit the banking system to rapidly move money across international borders, a challenge that law enforcement has struggled to address. “This joint working is a truly innovative approach to try and prevent this criminality. It is the first time this has been tried on such a scale anywhere in the world,” he added.

In comparison, Singapore launched a digital customer data-sharing platform called COSMIC with six banks in April. However, this initiative was led by the local regulator rather than law enforcement, Searle noted.

Banks have traditionally been cautious about sharing customer data due to concerns over UK and EU data protection and privacy laws, which could lead to litigation from customers whose accounts are investigated. However, the NCA and the banks assert that they only share account data with “multiple clear indicators of economic crime” and that all data sharing meets acceptable risk standards. “We are deeply conscious of the issues around data privacy,” one senior banking executive involved in the trial commented. The executive added that the terms and conditions of banks allow them to share information without notifying customers to fulfill legal obligations to detect and prevent financial crime.

The Financial Conduct Authority (FCA) is monitoring the project, and its involvement has increased the pilot’s viability, according to a banking source. This initiative builds on a previous pilot between the NCA, NatWest, and Lloyds from October 2021 to February 2022, which tested the practicality and benefits of combining bank and crime data to identify and disrupt economic crime, resulting in one arrest and charge.

Despite the project’s small scale relative to the total number of accounts in the UK, the ultimate goal is to use data for real-time insights to prevent crime. “But it’s a long way to go before we get there,” Searle acknowledged.

In a statement, the NCA explained, “The participating banks are providing the NCA with account data indicative of potential criminality. Subject matter experts and investigators from the NCA and the banks have formed a joint team to analyze the data, alongside the NCA’s own data. Any intelligence outputs will inform the NCA’s investigative work and help the banks to identify risk. Use of financial intelligence in such a way will better protect the public from serious and organised crime, and protect the integrity of the UK’s financial system.”

Adrian Searle further emphasized the project’s innovative nature, stating, “At the moment, criminals can exploit the banking system to move money at pace across international borders in ways that law enforcement has struggled to prevent. This joint working is a truly innovative approach to try and prevent this criminality. It is the first time this has been tried on such a scale anywhere in the world.”

Searle highlighted the collaboration’s potential to significantly enhance the detection and disruption of criminal activities, noting that since its operational launch in May, the project has already produced 90 intelligence packages supporting both NCA and broader law enforcement investigations. The project has aided the NCA’s top priority operations against threats like organized immigration crime, fraud, and money laundering. In one major fraud investigation, shared intelligence helped focus resources on new suspects and uncover new lines of inquiry.

The project also identified eight new organized crime networks, currently being evaluated by the NCA, and shared three intelligence packages with banking partners to enhance their defenses against organized crime. This initiative builds on a prior limited pilot by the NCA and two UK banks, demonstrating that the model of banks sharing relevant data with the NCA can generate valuable intelligence for law enforcement and financial institutions while balancing public protection from economic crime with customer privacy.

“The NCA and its banking partners have designed the data sharing principles to ensure that only account data with multiple clear indicators of economic crime is included. The data provided by banking sector partners only includes information on customers (people or businesses) that meet a set of markers which are indicative of potential criminal behaviour. The volume of accounts identified represents a very small fraction of the UK total,” Searle added.

Adrian Searle, who joined the NCA in March 2022 from NatWest where he served as Group Head of Data and Security Risk, has extensive experience in national security operations and policy, having led the government’s response to significant cyber incidents as a Deputy Director in the National Cyber Security Centre.

By fLEXI tEAM