Looking Down the Rabbit Hole

  Mistake #1: No Policies & Procedures  -  Why this can lead to misconduct Someone just microwaved fish in the lunch room. Lucy in the mail room is using her personal email address for business. Jack just installed some software on his station to work from home. It's absolutely amazing how many businesses I have come across that are in the process of growing and expanding, yet have never considered policies and procedures to be important. Policies are good practice guidelines that you and your employees should follow on a daily basis. There should also be a formal process in place for employees to sign and agree to the terms of the policies. Procedures are things that you do on a daily basis, but are documented so they can be replicated if needed by a new employee. Policies and procedures set clear expectations for employee behavior and job performance. They provide guidance on how to handle various situations, which can improve decision-making and reduce confusion or conflicts

  The Stakes of Financial Crime Prevention The battle against financial crimes is critical, supporting efforts to combat organized fraud, human trafficking, and drug trade. This fight demands that investigators be increasingly agile, efficient, and thorough in their approach. The consequences are significant, often a matter of life and death. Emerging Skills in AML The AML field is evolving, with key skills now including: Proficiency in Generative AI (GenAI) Understanding of Large Language Models (LLMs) Application of Machine Learning (ML) in fraud detection and transaction monitoring These technological advancements require: Human oversight Model risk management Strong ethical foundations The integration of these skills is creating new roles that leverage human expertise in: Enhanced due diligence investigations AML policy development Cybersecurity threat hunting Current Limitations and Proper Use of AI in AML At present, AI should not be relied upon for tasks requiring ju

  1. Pattern recognition and anomaly detection : Generative AI models can analyze vast amounts of financial transaction data to identify unusual patterns or anomalies that may indicate fraudulent activity. By learning normal transaction behaviors, the AI can flag deviations for further investigation. 2. Natural language processing of documents : AI can rapidly process and extract key information from large volumes of unstructured text like emails, chat logs, and financial documents. This can help investigators quickly sift through data to find relevant evidence and connections. 3. Predictive modeling of criminal networks : By analyzing historical data on known financial crimes, generative AI can create models to predict potential criminal networks or forecast likely future criminal activities. This allows investigators to take a more proactive approach.

  •   Use device based identity resolution : Resources such as Neustar. Recognize trusted devices to reduce friction for returning customers while flagging potentially suspicious new devices. •  Behavioral biometrics : Use technology that analyzes user behavior patterns (e.g., typing speed, mouse movements) to identify potential fraud without adding explicit steps for the user. •  Streamlined KYC processes : Optimize know-your-customer procedures by using digital identity verification tools that can quickly validate customer information. #consumerfraud #identity #financialfraud #fincrime #investigations #biometrics #kyc #banks #suspiciousbehavior #analytics

Over the past decade, technology in financial crime prevention has evolved significantly. When properly utilized, it serves as a powerful ally for financial institutions in their battle against fraudsters and in safeguarding customer assets. However, if misused, this same technology can become a destructive force, enabling theft, embezzlement, and devastating personal lives. Modern innovations like sophisticated behavioral analysis, AI, machine learning, and robotics offer valuable tools for this purpose. When implemented effectively, these technologies can enhance the detection of suspicious activities, minimize false alarms, and accelerate response times. The trick is understanding how to use this technology, when and where. It's onerous, it's expensive and as transactional volumes increase, so do the potentials for mistakes. You Can't See Me : Illicit actors establish numerous fraudulent accounts through shell companies to facilitate the laundering of their unlawfully ac

  Missing evidence is not the same as missed evidence or evidence that is lost. When I speak of missed evidence it relates to evidence that could have been found had the right avenues been followed down. One notable case is the O.J. Simpson murder trial from 1995. There was delayed collection of evidence wherein police waited hours before thoroughly searching the crime scene, potentially allowing evidence to be contaminated or lost. Among other errors there was overlooked evidence: A bloody fingerprint on a gate near the crime scene was not properly documented or analyzed. These investigative errors were exploited by Simpson's defense team to cast doubt on the prosecution's case, potentially contributing to his acquittal in the criminal trial. This could have been avoided by: Following proper evidence collection procedures and handling, Following proper documentation procedures in criminal investigations Instead, the playing field was leveled through time and age. Thankfully, l