Why are fraud detection and anti-money laundering so interesting?

Financial institutions are on the front lines of fraud detection and anti-money laundering (AML) in preventing financial crime. However, new technology available to criminals and increasingly sophisticated detection evasion techniques have rendered the current approaches near obsolete.

New approaches are needed for monitoring and identifying fraudulent activities that are not prohibitively costly for the organisations. At Amsterdam Data Collective, we provide data science solutions that leverage machine learning algorithms to identify AML activities efficiently and accurately in large datasets. We also understand the issues of applying advanced statistical techniques within the current regulations and the data engineering solutions necessary to make them work. This enables financial institutions to be the defenders against financial crime instead of the unwilling facilitators of the fastest growing criminal segment.

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Common problems in Fraud Detection & Anti-Money Laundering

Fraud detection and AML are crucial processes for preventing financial crime and protecting financial institutions from penalties, fines, and reputational damage. Leveraging data and machine learning algorithms can make these processes more efficient and accurate, allowing institutions to stay ahead of money laundering threats and minimise the risk of fraudulent activities.

However, the complexity of financial crime and changing regulatory environment make it challenging for institutions to remain compliant. ADC provides fraud detection and AML solutions that use ethical AI and comply with (EU and local) regulations, freeing up institutions to focus on growth with confidence.

Three biggest problems for financial institutions

In our experience, the biggest issues regarding fraud detection and AML are:

First, high false-positive rates are often observed and are an example of the ineffectiveness of fraud detection. Not only do they mask the real criminal activities, but they also lead to unhappy customers that are subject to increased scrutiny of their legitimate operations.

Second, advanced statistical detection approaches require good data quality, long histories and highly centralised availability that is difficult for most organisations. Pragmatic solutions are necessary that don’t lead to more technical depth and increased manual processes.

Third, keeping up with the increasing complexity and compliance of AML regulations can be difficult. In many cases, fines and negative headlines are more likely to come before clear guidelines are issued. This requires financial service

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What ADC can do for financial institutions

At Amsterdam Data Collective, we understand the challenges that financial institutions face in fraud detection and AML processes. That’s why we offer data-driven solutions that use advanced analytics and machine learning and data engineering to quickly identify potentially fraudulent activity while complying with regulatory requirements.

With our expertise in financial crime risk management, we provide our clients with the tools they need to grow their businesses with confidence.

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Identify AML activities

Our data science-based approach allows us to quickly and efficiently identify AML activities using scalable algorithms that process large datasets. By leveraging our expertise in transaction monitoring and analysis, we can accurately detect nefarious behaviour and provide actionable insights to prevent financial crimes.

With transaction monitoring software, we can easily monitor bank transactions, synthetic transaction monitoring, and web transaction monitoring. Our AML transaction monitoring process ensures that we can identify common types of financial crime and investigate financial crime quickly.

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Stay ahead of money laundering threats

We believe that prevention is the best defence against money laundering threats. That is why our solutions are designed to help financial institutions stay ahead of the curve by proactively detecting and mitigating risk.
Our approach involves assessing the soundness of the entire transaction monitoring framework and the alert handling procedure. Throughout the process, a focus is placed on improvements that are visible, have immediate benefits, and can be delivered quickly.

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Comply with regulations and minimise fines

We offer financial crime risk management services that help you stay compliant with EU and local regulations. Our team of experts are knowledgeable on the latest regulatory changes as well as the evolving topics and help financial institutions update their AML processes when necessary. We aim to provide our clients with peace of mind by ensuring that their AML processes comply with the required regulations.

Our transaction monitoring tools and approaches are designed to be flexible and adaptable and have been developed through our real-world experience with our clients enabling us to quickly identify and investigate potential financial crime activities. This further reduces the risk of penalties and fines associated with money laundering, which can be financially crippling to financial institutions.

Reduce false positives in transaction monitoring

Transaction monitoring models often produce many false positives; namely, legitimate transactions that are defined as suspicious or risky through the monitoring process. This leads to both wasted time and resources to investigate these false positives while simultaneously distracting from illegitimate ones as well as frustrating legitimate customers who are subject to these ineffective processes.

Our end-to-end approach will help your organisation reduce false positives and increase operational efficiency by assessing its transaction monitoring framework, developing customer risk profiles, and implementing improvements in the Systemic Integrity Risk Assessment (SIRA).

Want to read more about our expertise and what we can do for your financial institution?

Take a look at our blog “A Transaction Monitoring Framework to Reduce False Positives” or our guide to the “New EBA Guidelines and Regulatory Technical Standards”.

 

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