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Preventing financial crimes with analytics tools

Nurdianah Md Nur | Dec. 13, 2013
IBM global executive Richard Collard explains the benefits of using advanced analytics tools to complement the standard Transaction Monitoring systems in banks.

Besides providing business value to the enterprise, analytics tools can be used to better detect financial crimes unknowingly happening in banks, asserted Richard Collard, IBM global executive specialising in the subject of Transactional Fraud, Financial Crimes and AML (anti-money laundering).

Financial crimes, such as fraud, terrorist-financing and money laundering, are often difficult to identify as they are perpetrated across multiple systems and processes and banks usually do not have the ability to combine the systems, explained Collard. Besides that, analysts frequently do not have ample time to sift through the massive amount of available structured and unstructured data (email, handwritten notes and social media traffic) to discover patterns that may help with investigations.

Currently, most banks are using packaged Transaction Monitoring (TM ) systems that are accepted by regulators, such as Oracle Mantas, as part of their efforts to prevent financial crimes, said Collard. TM systems will assign a risk rating to transactions and highlight risky transactions that need further review. Although these systems work, they generate a considerably high percentage of false positives, thus impacting productivity, claimed Collard. For instance, if a TM system finds 100 false positives, the bank has to spend more resources (ie.employees) to go through 100 cases to find one genuine case that needs to be investigated.

Intelligent Investigation Manager
To counter the problems above, IBM offers its Intelligent Investigation Manager, which complements TM systems. The Intelligent Investigation Manager aims to improve the efficiency of investigations by capturing the relevant details and actions of each case. It also enables investigators to collaborate, and incorporate forensic and link analysis into the investigative process to provide investigators with leads and a better understanding of the financial crime. The Intelligent Investigation Manager is able to do all of the above as it contains the following components:

  • Case Manager which helps coordinate and manage the overall investigation as well as prepares case ready reports for negotiation or prosecution
  • i2 Fraud Investigation Analysis which delivers insight and context, visualises connections and provides evidence/output for criminal or civil prosecution
  • Content Analytics with enterprise search which searches, analyses and extracts entities. It also highlights suspicious patterns, provides flexible search and visualisation of unstructured data, pre-calculates and perpetually updates analytics, and scales to big data volumes.

The Intelligent Investigative Manager extracts and analyses structured and unstructured data from existing and often disparate sources, including emails, scanned documents and social media. Collard explained that the solution will then draw patterns, links and relationships in real-time to show the connections between entities. The solution can also provide visualisations such as maps and timeline that illustrate the scope of the financial crime, which may be useful to generate investigative leads and provide evidence for legal judgments, he added. Investigators can thus build cases more effectively with these provided information.


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