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Money laundering - worth over £90bn - is security threat to UK

Cyber crime and high-end money laundering are among the top five threats to the UK, according to a report by the National Crime Agency (NCA).

The National Strategic Assessment of Serious and Organised Crime 2016 notes that “Cyber crime has risen in the public consciousness owing to high-profile attacks which threaten UK business and public confidence in the security of their information online. And the daily impact of high-end money laundering persists, threatening the UK’s financial system and international reputation.”

Cyber crime 'under-reported and more aggressive'

On cyber crime, the report notes that “financially motivated, international organised criminal groups responsible for sophisticated malware campaigns remain a substantial threat to the UK”. It notes that cyber criminals are becoming “more aggressive and confrontational, with a rise in easy-to-execute criminal tools, many designed to extort money from victims”.

It also found that cyber criminals based in the UK and overseas make use of an “enabling marketplace providing products and services which continue to lower the barrier of entry to cyber crime”.

The NCA report suggests that there is “substantial under-reporting of cyber crime in the UK”. It adds: “The high likelihood of widespread under-reporting affects our ability to make a robust assessment of the cost of cyber crime... the best estimate extrapolated from incomplete data sources would put the annual cost of cyber crime to the UK in the low billions of pounds. This cost of cyber crime includes both the cost of defending against attacks and the financial losses involved with all types of cyber crime.”

Money laundering relied on 'professional enablers'

On the subject of money laundering, the NCA's report estimates that money laundering in the UK is likely to be above the international average, given the UK’s position as a key global financial centre. International averages put money laundering at between 2 per cent and 5 per cent of GDP. If applied to the UK's GDP of £1.8 trillion, the high-end money laundering in the UK would be worth between £36 billion and £90 billion.

The NCA says that “money laundering, particularly high-end money laundering, has the potential to threaten the UK’s national security, national prosperity and international reputation.

The report also notes:

  • Virtually all high-end money laundering schemes, and several cash-based ones, rely on professional enablers to facilitate activity. The skills, knowledge and abilities of professionals in the financial and legal sectors allow highly complex structures to be created that move and store large amounts of criminal money and conceal ownership effectively.
  • Cash-based money laundering continues to play a major part in many crime groups’ modus operandi. A high proportion of cash movements are managed by a small number of international controllers.
  • Private sector engagement is critical to identifying and disrupting high-end money laundering schemes, whether targeting individuals, disrupting techniques or target-hardening the UK’s financial system.  

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