Understanding Artificial Intelligence to fight money laundering
19 December 2017, by Bachir El Nakib (CAMS) Senior Consultant Compliance Alert LLC
Within the financial services sector, Anti-Money Laundering (AML) is a significant challenge for many institutions, often consuming large numbers of people and effort to manage the process and comply with the regulations. As a result, these same institutions are looking for new solutions to help them reduce the burden and increase the controls in this complex space. The combination of artificial intelligence (AI) and, more specifically, machine learning (ML), are increasingly being considered as enablers of a better solution.
ICBC divided the funds being transferred to China between multiple accounts to ensure they didn’t exceed the 50,000-euro limit above which it would have had to declare to authorities, according to the summary. The bank, it added, failed to report any suspicious transactions as required under Spanish law regarding 78 of its clients. Detention and bail rulings for some of these customers show that they were already under investigation for suspected involvement in a range of crimes, including money laundering, tax fraud, bribery, extortion, forgery and smuggling.
According to the confidential court filings, police allege members of these suspected criminal organisations used fake documents such as falsified passports to open accounts at ICBC’s Madrid branch. ICBC employees are suspected of accepting falsified invoices to justify the origin of money transferred to China, police say in the filings.
If the suspects from the bank and the alleged smuggling networks go on trial, it is possible some might deny they participated in the bugged conversations. They might also dispute the conclusions authorities drew from the wiretaps.
Yet for financial institutions that want to identify, track and stop money laundering and other financial crimes, the technological tools of banking’s yesteryear no longer cut it. A new wave of tech tools can help banks and other financial firms discover dispersed and complex webs of illegal activity.
Increasingly, financial firms are turning to artificial intelligence and sophisticated network analysis to detect such criminal enterprises.
\AI Helps Banks Catch Criminals