The True Cost of Compliance
In collaboration with LexisNexis.
![RB Feature Image Template - 2024-07-31T161844.623](https://www.oxfordeconomics.com/wp-content/uploads/2024/07/RB-Feature-Image-Template-2024-07-31T161844.623.png)
This report updates last years’ research on the detection and prevention of financial crime, and it’s cost to the UK financial services sector. We surveyed 254 senior compliance executives about their costs and compliance activities, and extrapolated the results to estimate the costs across the UK Financial Services sector. The report, by LexisNexis Risk Solutions, includes interviews with senior compliance officials, and presents the factors driving increases in compliance costs, and how people and technology are employed across the full range of compliance obligations in the fight against fraud and money laundering.
The study found compliance costs rose by double digits (12%) in 2023, with the vast majority (95%) of firms reporting an increase. Just 2% said costs had fallen. It means that collectively, the sector is now spending an astronomical £38.3 billion on compliance each year, equivalent to Estonia’s GDP. Costs have risen by nearly a third (33%) since 2021 – well above the rate of inflation – yet the NCA estimates that at least £36bn is laundered in the UK each year. Other key findings from the research include.
- 98% of firms have either already implemented or plan to adopt AI and machine learning analytical tools into financial crime screening processes by 2026.
- UK banks and fintechs spend £21.4k per hour fighting financial crime and fraud, pushing the UK’s annual compliance bill to £38.3bn.
- Rapid investment in technology and rising customer volumes are cited as key cost drivers.
To download the report, please complete the form below.
The experts behind the research
Our Economic Consulting and Thought Leadership teams are world leaders in quantitative economic analysis and original, evidence-based research, working with clients around the globe and across sectors to build models, forecast markets, run extensive surveys, and evaluate interventions using state-of-the art techniques. Lead consultants on this project were:
![](https://www.oxfordeconomics.com/wp-content/uploads/2022/08/Anubhav-Mohanty.png)
Anubhav Mohanty
Associate Director, Economic Consulting
![](https://www.oxfordeconomics.com/wp-content/uploads/2024/02/Ben-Skelton-NEW.png)
Ben Skelton
Lead Econometrician, Economic Consulting
![](https://www.oxfordeconomics.com/wp-content/uploads/2022/03/Headshot-circle-28.png)
John Reiners
Managing Editor, Thought Leadership
![](https://www.oxfordeconomics.com/wp-content/uploads/2022/09/Harry-Pickford.png)
Harry Pickford
Economist, Economic Impact
![](https://www.oxfordeconomics.com/wp-content/uploads/2022/12/Maximilian-Douglas-Carl-Vickers-1.png)
Maximilian Vickers
Research Associate
Read the report
Complete the form below to download the report.
Tags:
You may be interested in
![](https://www.oxfordeconomics.com/wp-content/uploads/2023/12/Manager-and-supervisor-in-shipping-warehouse-375x263.png)
The Socioeconomic Impacts of Employer Investments on Local Communities
A groundbreaking research program that is designed to shed new light on the topic of the socioeconomic impact of large employers entering a local community.
Find Out More![](https://www.oxfordeconomics.com/wp-content/uploads/2023/08/Untitled-design-20-375x263.png)
Friend or foe? Foreign policy takes centre stage
South Africa's preparations for the 15th Brics Summit in August, which the country is hosting, have been overshadowed by the International Criminal Court (ICC) and the warrant of arrest it issued for one of the expected attendees, Russia's President Vladimir Putin, on charges of war crimes. Domestic and foreign critics have accused Pretoria of being much too cosy with Moscow, notwithstanding official assurances that South Africa is neutral in the Russia/Ukraine conflict, and Washington's ambassador to the country caused a diplomatic storm in May when he claimed that South Africa had supplied Russia with weapons. Denials have since given way to a diplomatic charm offensive with South African officials trying to temper the concerns of the country's Western partners, who account for much of its trade, and its Brics partners, who are poised to welcome new members.
Find Out More![](https://www.oxfordeconomics.com/wp-content/uploads/2022/02/legalaidfc.png)
Forecasting criminal Legal Aid expenditure: 2017 update
The Law Society asked Oxford Economics to refresh its 2014 study to produce forecasts of criminal Legal Aid expenditure under alternative scenarios. A number of factors could affect Legal Aid expenditure over the next five years, including the volume
Find Out More![Tokyo city landscape](https://www.oxfordeconomics.com/wp-content/uploads/2023/12/Feature-image-gallery-85-375x263.png)
Tokyo – Hotspots and some optimism in a slow-growing city
We forecast that Tokyo Prefecture will remain Asia Pacific's largest city in GDP terms until 2034, before being overtaken by Shanghai, and then by other Chinese majors. Greater Tokyo will remain the world's largest city economy until at least 2050.
Find Out More