This article is part of Kyckr’s new Future of Financial Crime Series, which will feature interviews with leading industry professionals and thought leaders to learn more about the evolution of financial crime and the trends shaping the future.
The following is an interview we recently had with Dax White, Managing Partner at The White Law Group, LLC.
What is the state of financial crime today?
The biggest financial crime being committed every year is the garbage some financial advisors peddle on to their clients legally. High-risk, illiquid “alternative investments” that pay financial advisors huge upfront commissions and almost never work out for the investors. We speak with literally hundreds of these investors every year and the vast majority are retired individuals, who were sold on the income component of these products without being sufficiently advised of the enormous risks. More traditional financial crime is of course tragic, but the peddling of alternative investments (a multi-billion dollar legal industry) is ruining the financial lives of thousands of retired investors every year and it has been for quite some time.
How has financial crime evolved over the past 5 years?
The biggest evolution of financial crime and fraud over the last 5 years has certainly been the digitisation of such activities. Whereas it used to be that a financial criminal had to spend hours identifying and grooming their victim, whether it be affinity fraud, elder abuse, etc., now this has all become scalable and the biggest threats are now all via the internet and the schemes can be launched on a massive scale.
What’s the future of financial crime?
As previously stated, the digitisation of fraud will continue to be the future, but more specifically financial crime will increasingly occur in the digital coin space. Always follow the money when investigating financial crime and that is most certainly where the money is right now. Investors looking to get rich quick make for an easy mark and the anonymity of digital coins makes it that much easier for fraudsters to get away with schemes. Also, because the many exchanges these transactions are still occurring on lack regulation it becomes harder to protect investors and to assist them when financial crimes occur.
About Dax White
Dax White is the managing partner of the White Law Group, a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois. Mr. White has handled over 600 FINRA arbitration cases, including handling claims against most of the FINRA registered broker-dealers. These cases have included claims for, among other things, unsuitability, fraud, negligence, failure to supervise, and breach of fiduciary duty.