The fight against money laundering and related activities is a never-ending one. As much as we automate and improve our detection methods, the criminals continue to become smarter and more devious. And even after deploying all the tools in our arsenal, it often seems that we're still not as effective as we would hope to be. The key piece of the puzzle here is the investigator who can separate the wheat from the chaff. It is the investigator who digs through all the evidence and identifies the suspicious activities. By making the work of the investigator easier, we leave more time for deeper analysis and looking at activities more closely, leading to better decisions.
There are many activities involved in the investigation process. Communication with peers may be the most variable part of the process, and it also has the potential to take the longest amount of time to pursue. As customers interact with their financial institution, they provide information, create patterns and form relationships. In the past, the only way to collect this information was to reach out to the involved people and try to gather their input. This has often been a tough and thankless task - creating questions that will prompt colleagues to provide answers without disclosing confidential information, plus following up with reminders, more reminders and some more reminders. When and if answers finally arrive, the analyst needs to parse and interpret them.
There are two recent trends that can impact and transform this part of the investigation, while speeding up our understanding of a customer's actions:
Better Record Capturing
New recording technologies now allow us to collect and combine all the interactions between the customer and the financial institution - phone conversations, emails and even chats. By storing and organizing those interactions, we have direct access to the explanations, motivations and even attitudes of the customer. Looking across many financial institutions, we've often seen situations in which unusual and suspicious activity was accompanied by customer communications.
Often, the customer offers a range of explanations to the financial institution addressing the background and reason for a specific activity. Those communications occur either before or after the actual transactions. Before, this information was only accessible through a query to the relationship manager or the branch and might not even be available at all. The advent of modern recording technologies now provides transcription, archiving and indexing of all communication channels. Moreover, we get far more accurate search and retrieval capabilities on customer interactions. Direct access to the customer's communications allows the investigator to review this information more quickly, saving valuable time.
When viewing customer communications at a higher level of granularity, patterns start to emerge. Looking at historical activity of each customer enables complete understanding of their common communications, the type and quantity of the information usually provided and their handling of unusual scenarios. By leveraging Natural Language Understanding (NLU) and AI-driven behavioral analytics technologies, it's possible to analyze those communications over time. This allows us to identify trends and most importantly, highlight anomalies. From a practical perspective, this information allows investigators to quickly deal with a high volume of communications and "zero in" on the most important pieces. Besides saving time, this can also bring to light anomalies that are relevant to the investigated activity.
Holistic AML Investigation
By combining communication recording and searching with behavioral analytics, it is possible to give AML investigators direct access to the relevant information provided by the customer. This means that when trying to understand the background to unusual or suspicious activity, the investigator no longer needs to rely on the memory or the communication skills of relationship managers.
We can use this information in two ways - the most immediate benefit is by allowing investigators to directly review any and all customer communications when investigating a customer. In many cases, this information would contain verifiable explanations and backgrounds to the investigated activity. In parallel, identifying behavior anomalies and suspicious communication patterns can be easily translated into customer risk factors - combined with their profile and activity to identify higher risk customers and raising the importance of red flags associated with their activity.
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