Money laundering is nothing new but regulations and enforcement in compliance has increased significantly since the September 11th terrorist attacks. “The number of anti-money laundering (AML) regulations really ballooned, and continues to increase,” said Richard Stocks, Pitney Bowes solution director for financial crimes and compliance. “Once upon a time, banks worked with a certain set of known rules and regulations. Things moved more slowly. You had time to learn how to accommodate the next regulatory change, the next risk. No more.”
The increase in regulations has been an attempt to keep ahead of the criminal activity taking place online, as bitcoins and other virtual currency make layering easier. While AML efforts have remained strong, it is still no easy task to ensure compliance, especially as incomplete views of customer hinder efforts.
While the technology backing the fight against money laundering is more innovative than ever before, the systems are only as good as the data behind them. In many cases, customer views are siloed and dispersed such that financial institutions are unable to create a single profile for an entity, giving banks the inability to examine what’s really going on behind a transaction. The result of this has been a surge of false alerts, putting banks at risk of non-compliance.
However, there are solutions available to banks that can find and link data from multiple sources into a specific entity and its customers and back to the exact method of money transfer. The link eliminates the needs for investigators to follow paper trails to uncover information about a specific bank customer and the entities networks and reduce the overall volume of false positive alerts. Called entity resolution, the process helps administrators gather a complete body of data about one particular item or object. Information may then be presented such that investigators can easily visualize the client’s history within his or her networks and the institution itself.
By improving entity resolution, technology can help banks avoid fines and prosecution, and most importantly, help banks more cost efficiently and effectively detect and investigate financial crimes today.
Interested in learning more about how you can improve entity resolution? Download Pitney Bowes’ whitepaper here.