Friday's Final Word
As financial crime evolves alongside technology and political shifts, this month's top stories showcase how regulators, corporations, and AI systems are adapting to combat emerging threats - from deepfake scams to corporate fraud.
?? Trump's victory and AI policy shift: What it means for regulation
?? Serious Fraud Office given extra funding to fight financial crime
??? Former FTX CTO joins US gov to build fraud detection tool
??The dark side of AI: deepfakes and disinformation?
?? New failure to prevent fraud guidance published
Trump's victory and AI policy shift: What it means for regulation
Trump's impending presidency signals a major shift in AI regulation, with plans to dismantle Biden's AI Executive Order that established reporting requirements for AI companies and created the U.S. AI Safety Institute (AISI). While Trump's approach is expected to favor lighter-touch regulation and rely on existing laws rather than creating new ones, this federal pullback could lead to increased state-level AI regulation, particularly in Democratic strongholds like California. The administration's potential protectionist policies, including stricter export controls on China and proposed tariffs on imports (10% generally and 60% on Chinese products), could significantly impact the AI sector's development and global cooperation in AI governance.
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Serious Fraud Office given extra funding to fight financial crime
The UK Serious Fraud Office (SFO) has received an additional ￡9.3 million in funding, with ￡8.3 million earmarked for reforming case management and evidence handling systems, while also establishing a new confiscation team for asset recovery. The funding boost will increase the SFO's annual budget to ￡88.9 million for 2025-26, strengthening its ability to tackle complex fraud cases that typically take over four years to complete and involve around 5 million documents. This development comes as the agency handles major cases including the Glencore bribery investigation and follows earlier criticism of its disclosure practices, while simultaneously dealing with potential damages payments in the ENRC litigation where it has set aside more than ￡200 million.
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Former FTX CTO joins US gov to build fraud detection tool
Gary Wang, FTX's former Chief Technology Officer and co-founder, is collaborating with the US government to develop anti-fraud software tools for cryptocurrency oversight as part of his 2022 plea deal with the Department of Justice. Wang, who is scheduled for sentencing on November 20, is working on two software tools - one for detecting fraud in public markets and another for identifying illegal activities on crypto trading platforms - while his legal team seeks a time-served sentence based on his cooperation and testimony that helped convict Sam Bankman-Fried. The development comes as part of broader efforts to strengthen crypto exchange transparency and prevent financial fraud, with Wang's involvement demonstrating attempts to make amends for his role in FTX's collapse.
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The Dark Side of AI: How deepfakes and disinformation are becoming a billion-dollar business risk
A single AI-generated deepfake or piece of disinformation can now cause immediate financial damage to companies, from wiping millions off market values through fake videos of CEOs to manipulating stock prices with synthetic images of corporate disasters. Beyond financial impacts, businesses face growing threats from sophisticated voice cloning scams targeting employees, AI-generated fake reviews damaging customer trust, and identity theft schemes using animated stolen photos for fraudulent applications. The article advises companies to implement comprehensive defense strategies including employee education, deepfake detection tools, and proactive transparency about protection measures, noting that success requires making vigilance and rapid threat verification core parts of organizational culture.
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New failure to prevent fraud guidance published
The UK government has released guidance on a new corporate criminal offense that will hold large organizations criminally liable if they profit from fraud committed by employees, agents, subsidiaries, or other associated persons. Organizations will need to demonstrate they had reasonable fraud prevention measures in place to defend against prosecution under this law, which is part of the Economic Crime and Corporate Transparency Act and comes into force on September 1, 2025. The guidance, developed with input from multiple government agencies including the Serious Fraud Office and Financial Conduct Authority, aims to encourage an anti-fraud culture similar to how the failure to prevent bribery legislation has reshaped corporate behavior since 2010.
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