Financial institutions are increasingly collaborating to combat financial crime by sharing information, with legal frameworks like section 314(b) of the USA PATRIOT Act facilitating this in the U.S. and similar initiatives emerging in Europe. However, current methods are often manual and inefficient, prompting the need for integrated systems and technologies such as homomorphic encryption to enhance security, privacy, and efficiency. Homomorphic encryption, a privacy-enhancing technology, allows encrypted data to be used for computation and analysis, enabling secure collaboration across institutions without exposing raw data. This technology is gaining support from regulators and is being used in various applications such as secure querying for Know Your Customer (KYC), alert triaging, and investigations, promising to improve the detection and prevention of financial crimes while ensuring compliance with privacy regulations. As demand for homomorphic encryption grows, particularly in regulated industries, developments in performance and scalability are expected to further drive its adoption and integration into financial crime prevention strategies.