Demystifying AI for AML: European Banking Federation and SAS Help Banks Worldwide Fight Financial Crime

The United Nations Office on Drugs and Crime estimates that US$800 billion to $2 trillion is laundered through worldwide financial systems each year. That’s an astonishing 2-5% of global GDP. The European Banking Federation (EBF) – uniting 32 national banking associations in Europe, representing 5,981 banks with roughly 2.6 million employees – has partnered with SAS to help financial firms worldwide curb the deluge.

“Rapidly evolving business and technology render conventional methods for anti-money laundering (AML) inefficient and call for a more innovative approach for fighting financial crime,” said EBF CEO Wim Mijs. “The future of AML is rooted in the use of innovative technologies and shared solutions that, in practice, enhance experts’ judgment and reveal the full picture when dealing with complex criminal networks. We are confident that this collaboration with SAS will help us prepare our members, and the broader banking community, for this new reality.”

In the European Union, despite the ever-rising number of suspicious activity reports, data from Europol shows that no more than 1.1% of criminally obtained assets were confiscated between 2009 and 2014. To combat this worrying trend, the European Commission introduced a new AML package this July. Among other changes, for the first time, banks and other obliged entities will need to comply with a directly applicable regulation. A new European AML Authority will also become operational in the years to come.

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AML Masterclasses, free of charge

In early 2022, the EBF and SAS will launch a joint, virtual AML Masterclass series, led by AML experts versed in using advanced analytics for AML. Unlike conventional courses on the subject, which focus primarily on the regulatory and operational aspects of AML, this series will spotlight how artificial intelligence (AI) and machine learning can boost the effectiveness of banks’ efforts in fighting financial crime.

Pre-register today for the complimentary, two-part AML Masterclass, which will include:

• Demystifying AI for Anti-Money Laundering. Debuting in March 2022, the inaugural session will examine how AI and machine learning technology for AML really works. It will also explore shared transaction monitoring facilities as an opportunity for enhancing AML transaction monitoring and how it fits into the current regulatory framework.
• New Technologies for KYC. In April-May 2022, the second session will snapshot the current legislative landscape and delve into novel ways advanced analytics can facilitate banks’ know your customer (KYC) and customer due diligence processes. Experts will also demonstrate how solutions like digital identification and network visualization can improve the transparency and efficiency of customer onboarding.

Following the online Masterclass sessions – and aligning with the ACAMS Europe Conference in June 2022 – the EBF will host an in-person social event with SAS in Brussels. There, a panel of AML experts will lead a discussion and live Q&A on how banks can embed advanced analytics into their AML frameworks.

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More than just “checking boxes”

In January, the Financial Action Task Force (FATF), the intergovernmental watchdog for financial crime, warned that the COVID-19 pandemic had enabled criminals to exploit digital identity loopholes.

Around the same time, SAS, KPMG and the Association of Certified Anti-Money Laundering Specialists (ACAMS) surveyed more than 850 ACAMS members globally to gauge how compliance professionals were adjusting their AML strategies amid the pandemic. The resulting AML technology study, published in August, revealed that:

• One-third of financial institutions reported accelerating their AI and machine learning adoption for AML compliance in response to COVID-19.
• Another 39% indicated their AI and machine learning adoption plans continued unabated, despite the pandemic’s disruption.

“Our research shows the industry at a critical crossroad. Banks by and large recognize AI as an AML game changer, yet most are still trying to wrap their arms around the technology and how to optimally harness it,” said Stu Bradley, Senior Vice President of Fraud and Security Intelligence at SAS. “In collaboration with the EBF, we look forward to illuminating banks’ paths forward with practical guidance that raises their thinking beyond merely checking the compliance boxes. With the right approach, AML can deliver bigger-picture transformation across the breadth of banks’ fraud and risk management functions.”

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