Fighting financial crime from Jersey
Financial crime, identity theft, cyber attacks... they are words which will instill fear into both businesses and individuals. And there is good reason to be afraid as, in the worst cases, such instances can lead to both financial and reputational ruin.
Worryingly, such crimes are also increasing in frequency, sophistication and complexity.
As Adam Brown, head of the product and delivery team at Vaiie, explains: ‘There are tens of millions of cases of identity theft every year across the world; it’s a multi-billion-dollar problem and it’s constantly growing. In the US alone, there were a million more cases of identity theft in 2022 than in 2021.’
Attributing this rise to two main reasons, Adam continues: ‘As technology advances, the act of committing a crime becomes easier and, at the same time, the potential rewards for less effort are growing ever higher.’
And, as criminals develop ever-more-sophisticated technology, so those helping to safeguard firms against such incidents have to raise the bar.
‘It’s fair to say that we are in a technology arms race with those who do not care about breaking the rules,’ Adam reflected. ‘For Vaiie, as a regtech business supporting the financial services sector and government, our role is to understand what is happening in the world today – and what is likely to happen tomorrow – and to deliver solutions which will enable clients to fight those challenges.
‘It’s a case of using technology more smartly and deploying digital solutions to carry out checks that the human eye cannot necessarily perform.’
With a background in handling complex data from major financial services, telecommunication, energy and insurance firms, Vaiie – which is part of the Jersey Post Group – has spent the past couple of years pioneering software solutions which Adam says are designed to ‘set new digital standards in regulatory technology so that customers can make smarter decisions’.
‘While regtech is still relatively new, the processes it is addressing have been undertaken for decades,’ he said. ‘However, as technology has been blended with these activities, regtech has come to the forefront and there is a significant opportunity for Jersey, as a leading international finance centre, to drive this space and develop solutions which meet real-world problems.’
To this end, last year Vaiie launched Identify, an identity verification tool which among other checks, can check more than 11,000 document templates as part of a process to confirm a customer’s identity.
‘If you imagine someone walking into a bank and presenting say an Argentinian passport, at best case the staff member may refer to a manual to see what the passport should look like,’ said Adam. ‘In the worst case, they may compare the passport to images online. Our technology, on the other hand, can check the actual template against the same database used by border control agencies to make sure that the document is genuine.’
Describing the product as a ‘workflow-based tool’, Adam added: ‘Our clients’ clients can undertake identity verification through a secure link. Once a client accesses the link, they are asked to scan an identification document, record a video selfie to prove that they are a living person and upload any supporting documents such as proof of address. We then triangulate the video selfie results with the identification document as part of a risk-based scoring system.’
While Vaiie Identify is targeted predominantly at financial services clients, the 16-strong organisation has also worked with the Government of Jersey to launch a similar product designed to help Islanders to access online government services.
‘JerseyMe is the dedicated government-based version of Identify, which we launched in June 2022,’ he said. ‘Islanders completing their tax returns online will be familiar with this method of identification verification, which enables people to interact with government services. It is really important that, as more and more services are digitised, no one is left behind.’
To this end, not only has Vaiie developed the software, but Jersey Post’s customer service team and Broad Street Post Office employees are also trained to help Islanders to access the service.
‘Developing a system which has been embraced by the government has been hugely significant for us and, excitingly, this is a system which could be scaled and rolled out beyond Jersey,’ said Adam.
And that same global outlook applies to the firm’s suite of identification technology, which sits under the Vaiie Onboard umbrella.
‘While Vaiie Identify and Vaiie Intelligence – our screening and monitoring solution – are available as individual modules, they also exist within Vaiie Onboard which, as the name suggests, is designed to help firms to map out an onboarding process for their customers,’ Adam explained. ‘Designed to offer a bespoke solution to each firm, Onboard offers a workflow-based approach which aligns with clients’ needs and enables them to undertake those all-important checks based on areas such as identity, sector risk, country risk, adverse media and sanctions.
‘While smaller or more niche firms may only need the Identify product, larger or more complex firms, such as fund administrators who have to manage the onboarding of an entire structure of companies and individuals, may need the full Onboard suite. It is all about giving people the right tools to meet the industry needs.
‘As with the overall Jersey Post Group, Vaiie’s outlook is global. We have developed products which can be scaled and be rolled out worldwide, particularly across other international finance centres. By launching in Jersey, where a number of international businesses are headquartered, we can scale very quickly through their offices into other jurisdictions.’
And with the need for vigilance and risk analysis becoming greater as criminals grow ever more sophisticated, the potential for the regtech industry is also growing, says Adam.
‘If people are using technology to commit fraud, the only way you will beat that is through technology,’ he explained. ‘Firms need to be constantly vigilant, and it is a combination of people, process and technology which will give them the best opportunity to detect, and act on, financial crime.’
Article taken from the Jersey Evening Post supplement "Driving a digital future" which was first published on 29/03/2023. View the online edition.