Thursday, December 29, 2022


Compliance offices, do NOT underestimate your worthy opponents, meaning the lawyers, accountants and financial services professionals who make up the bulk of the world's practicing money launderers. As a bank lawyer-turned career money launderer, I encountered many laundrymen with far better skills than I had, all acquired in the financial and legal fields, and they were very, very good at their jobs.

Your opponents are familiar with compliance procedures, including the guidelines you follow in assessing whether suspicious transactions, or transactions inconsistent with a client's trade or business are present, and conduct themselves accordingly, so that you do not identify their operations. They engage in countermeasures that defeat your system.

For example, they often spread out their Placement activities among several active but seemingly unrelated accounts in the same bank, because they know that neither your examination nor your software will make the connection. Using traditional and legacy methods, you will not ferret out the well-distributed funds, because they do not follow any semblance of a pattern. Neither your rules-based systems nor your human eye will pick up the pipeline.

Enter the use of a platform employing artificial intelligence with machine learning; it not only finds the opaque relationship between the transactions, it engages in a lookback to extract possibly connected prior transactions, and look forward, observing the latest entires, assembling all of them, past, present and today, into a cohesive result that shows you something that your legacy system ignored, because it doesn't have the ability to develop unrelated data.

The use of AI, in conjunction with experienced staff who know how to read the results, and draw conclusions, can remove the laundrymen's historic advantage over compliance programs that have rules-based limitations. If you have not already upgraded, it's high time to do so, so that you can stop the money launderers exploiting your bank in their tracks.

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