LONDON—A new study from SmartSearch reveals over 80% of U.K. regulated firms in the legal, property and finance and banking sectors are likely to make a change to electronic verification of their customers.
The movement arrives as firms feel the growing weight of compliance around anti-money laundering and sanctions regulations – amid a sharp increase in the number of companies fined by regulators for breaches of the rules, The Financial Reporter said.
According to the report, the most recent figures from Her Majesty's Revenue and Customs show 85 firms were fined and named last year for breaches of compliance regulations. And a freedom of information request revealed a sixfold increase in the number of legal firms fined by the Solicitor’s Regulation Authority since 2017, The Financial Reporter said.
Meanwhile, the Financial Conduct Authority recorded financial penalties totaling £568 million for firms in the financial sector in 2021.
Misconception Persists
SmartSearch's research found that more than 90% of firms in the financing and banking sector are considering the switch to electronic verification, with two thirds of them “actively” doing so.
However, almost a quarter (23%) of all the firms persisted with the misconception that using hard-copy documents was more reliable than electronic checks, The Financial Reported noted in its analysis.