A Legal Perspective on Cybercrime and Financial Fraud in the Banking Sector
Cybercrime, Financial Fraud, Banking Law, Regulatory Compliance, Digital Banking Security
In the contemporary digital landscape, the financial sector has increasingly fallen prey to cybercrime and financial fraud, highlighting the necessity for robust legal structures to ensure security and stability. Banking law plays a crucial role in addressing the challenges posed by cyber threats, protecting consumer rights, preserving financial integrity, and ensuring adherence to regulations. This dissertation explores the evolution of banking law in response to cybercrime and financial fraud, examining both national and international legal frameworks governing financial institutions. Cybercrime within the banking industry manifests in various forms, including identity theft, phishing, ransomware attacks, and fraudulent transactions. Conversely, financial fraud encompasses activities such as money laundering, insider trading, and Ponzi schemes, all of which can have dire economic consequences.The rise of digital banking and fintech innovations has further exposed financial systems to sophisticated cyber threats, underscoring the need for legal measures to mitigate risks. A critical aspect of banking law in combating cybercrime is the implementation of stringent cybersecurity regulations. Governments and regulatory bodies across the globe have enacted laws such as the Gramm-Leach-Bliley Act (USA), the General Data Protection Regulation (GDPR) (EU), and the Cybersecurity Act, mandating financial institutions to adopt robust security protocols. These regulations require banks to implement risk management frameworks, data encryption, multi-factor authentication, and continuous transaction monitoring. Nevertheless, despite these safeguards, cybercriminals persist in developing advanced techniques to circumvent security measures, necessitating ongoing reforms in legal frameworks.Another important focus of banking law is the prevention of fraud and the protection of consumers. Financial regulators such as the Financial Action Task Force (FATF), the Basel Committee on Banking Supervision, and the Financial Crimes Enforcement Network (FinCEN) have created anti-money laundering (AML) and counter-terrorism financing (CTF) regulations to monitor suspicious financial activities. Additionally, Know Your Customer
The policies regarding Know Your Customer (KYC) and Customer Due Diligence (CDD) have been enhanced to verify client identities and prevent fraudulent activities. However, the enforcement of these measures remains difficult due to the international nature of cybercrime, which necessitates cooperation and information exchange among financial institutions and law enforcement agencies across different countries. This dissertation also explores the challenges of enforcing banking regulations against cybercrime.A primary obstacle is the issue of jurisdiction, as cybercriminals operate across multiple nations, complicating legal enforcement. Additionally, financial institutions often face difficulties in balancing security with user convenience, as overly strict regulations may hinder the adoption of digital banking. The rise of cryptocurrencies and decentralized finance (DeFi) platforms presents another challenge, as traditional banking regulations struggle to effectively govern these new financial models. In response to these issues, banking law is continually evolving, incorporating artificial intelligence (AI) and blockchain technology for fraud detection and regulatory compliance. AI based fraud detection systems analyze transaction patterns to identify anomalies, while blockchain enhances transparency and traceability in financial transactions. Future banking regulations are expected to focus on real-time monitoring, global regulatory alignment, and improved cybersecurity measures to tackle the ever-evolving landscape of financial crime. In conclusion, banking law plays a vital role in combating the rise of cybercrime and financial fraud by establishing regulatory standards, enforcing compliance, and fostering international collaboration. However, as cyber threats continue to evolve, legal frameworks must adapt to new technologies and financial innovations. This dissertation provides a thorough analysis of the effectiveness of current banking laws, the challenges of enforcement, and potential future developments.
"A Legal Perspective on Cybercrime and Financial Fraud in the Banking Sector", IJSDR - International Journal of Scientific Development and Research (www.IJSDR.org), ISSN:2455-2631, Vol.10, Issue 5, page no.a368-a426, May-2025, Available :https://ijsdr.org/papers/IJSDRTH01006.pdf
Volume 10
Issue 5,
May-2025
Pages : a368-a426
Paper Reg. ID: IJSDR_303149
Published Paper Id: IJSDRTH01006
Downloads: 000388
Research Area: Science and Technology
Country: bargarh, odisha, India
ISSN: 2455-2631 | IMPACT FACTOR: 9.15 Calculated By Google Scholar | ESTD YEAR: 2016
An International Scholarly Open Access Journal, Peer-Reviewed, Refereed Journal Impact Factor 9.15 Calculate by Google Scholar and Semantic Scholar | AI-Powered Research Tool, Multidisciplinary, Monthly, Multilanguage Journal Indexing in All Major Database & Metadata, Citation Generator
Publisher: IJSDR(IJ Publication) Janvi Wave
