How banks can solve the anti–money laundering challenge

Social Business Manager, IBM

Imagine yourself on a football field with turf under your cleats, floodlights illuminating your jersey. Crouched next to your teammates, the familiar weight of pads on your shoulders, you stare into the eyes of the defensive lineman opposite you. The game is about to begin.

In the same way, banking professionals step onto the field every day to fight money laundering, entering the office in their business suits to join their coworkers under fluorescent lights. When they look into the eyes of financial criminals, they do not flinch—because they have the equipment they need to protect themselves and their customers. Using advanced anti–money laundering (AML) technology, they score touchdown after touchdown—game after game.

Make a goal-line stand against money laundering

Financial crime is as big as a Texas-sized stadium. Indeed, some estimate that between $800 billion and $2 trillion is laundered every year. That’s 2–5 percent of global GDP! Between 2003 and 2012, the illicit financial flow clocked in at 6.6 trillion dollars. That adds up to a lot of Sunday tickets—and developing and emerging economies can be disproportionately affected. But that’s not the end of the costs. Last year, banks were fined more than seven times as much as they were the previous year. The costs of financial crimes are high, but so are the compliance risks.

Sometimes we can feel as if banks are down by two touchdowns in the fourth quarter when it comes to combating money laundering. The challenges that face banking professionals seem overwhelming at times, and corporate data silos limit the effectiveness of AML solutions. Worse yet, counterfraud measures raise too many false positives—and yet fraudsters still slip through the gaps. On top of it all, transparency and regulatory compliance reporting multiply the complexity—yet are absolutely necessary.

The counterfraud struggle can have nail-biting consequences: Banks could face millions of dollars in fines. Chief compliance officers could face personal liability. Financial institutions could incur costs that threaten their very existence. And amid all these challenges, banks run the risk of fumbling, instead of innovating, at the crucial moment.

Run interference against financial fraud with banking analytics

On the financial gridiron, you can be the offensive coordinator, calling the plays and leading your team to victory. How can you start? Follow these steps to begin managing money laundering bank fraud:

  • who is whom. Leveraging big data and analytics, get to know your customers, finding out whether they are who they say they are.
  • Discover who knows whom. Use data analytics to uncover complex relationships, finding out how people are—or have been—related.
  • Discover who does what. Monitor individuals’ behavior, both transactional and nontransactional, to ensure compliance and diminish the risk of fraud.

Football players don’t use their second-best equipment on game day. In the same way, financial institutions must use every means at their disposal to guard against financial crime. But don’t resort to a Hail Mary—banks need look no farther for protection than IBM AML Monitoring and Analytics for Banking. Using this anti-money laundering solution, organizations can

  • Expose identities and uncover hidden relationships through predictive and entity analytics
  • Expand cross-channel visibility and enhance risk scoring by leveraging multilayered analytical processing
  • Shorten investigation time and hasten case management through state-of-the-art forensics
  • Adapt operations through big data techniques as money laundering schemes evolve

Only by training can football players do their best on game day, and the same is true of banks. Request a free workshop to learn about common obstacles in financial crime management that face the banking industry, and discover how an AML monitoring and analytics solution for banking can help your organization cross the goal line.