THE INTERSECTION OF FRAUD, SANCTIONS AND ORGANISED CRIME
R&C: How is the reclassification of organised crime as national security or terrorism threats reshaping fraud and sanctions enforcement priorities?
Mendes: Illicit activity is illicit activity. From a financial institutions’ (FIs’) operations perspective, the reclassification does not change anything. Rather, it reshapes how governments are thinking about the threat and how that results in changes in enforcement. Fraud was traditionally seen as an economic crime. Today, it is often considered as strategically destabilising a nation or location. This reclassification has shifted the way sanctions are used. Historically, sanctions were used as a foreign policy tool to implement force. Now, they are used more as a way to undermine a geopolitical objective. There has also been a shift in the way teams are organised, which allows for better communication and coordination when escalating priorities. As a result, fraud teams are now looking more for networks than individuals.
Costaldo: Historically, unlike the teams that monitored sanctions compliance, the teams that managed fraud were separate, isolated and siloed. There has been a shift, especially with the adoption of artificial intelligence (AI) and the need for complex data analysis, to bring the related information from each of these types of compliance vehicles together. There is now a lot more synergy and consolidation of information. For example, a crime may end up being money laundering, but it started as fraud via an account takeover.
Jul-Sep 2026 Issue
FTI Consulting