{"id":121690,"date":"2023-05-01T12:02:16","date_gmt":"2023-05-01T12:02:16","guid":{"rendered":"https:\/\/feedzai.com\/?p=121690"},"modified":"2024-04-09T09:13:32","modified_gmt":"2024-04-09T09:13:32","slug":"how-feedzai-embeds-next-generation-anti-money-laundering-solution-optimization","status":"publish","type":"post","link":"https:\/\/feedzai.com\/blog\/how-feedzai-embeds-next-generation-anti-money-laundering-solution-optimization\/","title":{"rendered":"How Feedzai Embeds Next-Generation Anti-Money Laundering Solution Optimization"},"content":{"rendered":"
[vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”1″ bottom_padding=”2″ overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ shift_y=”0″ z_index=”0″][vc_column width=”1\/1″][vc_row_inner][vc_column_inner width=”1\/12″][\/vc_column_inner][vc_column_inner width=”10\/12″][vc_single_image media=”121699″ dynamic=”yes” media_width_percent=”100″ uncode_shortcode_id=”977980″][\/vc_column_inner][vc_column_inner width=”1\/12″][\/vc_column_inner][\/vc_row_inner][vc_row_inner][vc_column_inner column_width_percent=”100″ gutter_size=”3″ overlay_alpha=”50″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ medium_width=”0″ mobile_visibility=”yes” mobile_width=”0″ width=”2\/12″][\/vc_column_inner][vc_column_inner width=”8\/12″][vc_custom_heading heading_semantic=”h3″ text_size=”h3″ text_weight=”400″ uncode_shortcode_id=”115666″]The challenges of modern financial crime are pushing banks ever more into the vanguard. Banks worldwide are grappling with a $2T money laundering problem that requires next-generation anti-money laundering<\/a> solutions. These organizations need to be armed with the latest technology to avoid being overwhelmed.<\/span>[\/vc_custom_heading][vc_column_text uncode_shortcode_id=”213925″]Rules-based legacy systems simply aren\u2019t able to address the sophistication of today\u2019s financial crime tactics. Banks need to optimize their anti-money laundering (AML) alerts to effectively detect and intercept suspicious activity.\u00a0<\/span><\/p>\n Here\u2019s how Feedzai addresses the challenge using patented AI technology to optimize AML alerts \u2014 without requiring banks to immediately retire existing rules-based systems entirely.\u00a0<\/span><\/p>\n Before looking at how next-generation anti-money laundering solutions can help, let’s first look at the common pain points caused by rules-based legacy systems.<\/span><\/p>\n The financial services industry has experienced a digitalization boom in the past few years. However, many existing AML systems use a rules-only approach to transaction monitoring. Without next-generation anti-money laundering methods in place, banks\u2019 legacy systems will be unable to meet the demands of the digital banking workflow. The result is a large amount of false positive alerts. This leaves compliance teams scrambling to address non-issues instead of focussing on the real threats.\u00a0<\/span>[\/vc_column_text][vc_single_image media=”121712″ media_width_percent=”100″ uncode_shortcode_id=”905066″ el_class=”hide-in-mobile”][vc_single_image media=”121716″ media_width_percent=”100″ uncode_shortcode_id=”134971″ el_class=”hide-in-desktop-tablet”][vc_column_text uncode_shortcode_id=”208908″]<\/p>\n It\u2019s estimated that about <\/span>95% of a bank\u2019s system-generated alerts are false positives<\/span><\/a>. Banks\u2019 compliance officers must address this struggle to remain focused and avoid being disheartened. A recent <\/span>survey<\/span><\/a> found that nearly half (49%) of compliance officers feel overwhelmed at least weekly. If compliance officers can\u2019t trust the quality of AML alerts, they risk spending valuable time on unproductive suspicious activity reports (SARs). In other words, compliance professionals often chase false positives instead of focusing on high-value alerts and identifying financial crimes. No wonder so many compliance officers feel burned out on the job.<\/span><\/p>\n Banks worldwide spend billions on financial crime compliance each year. Yet despite these heavy investments, global regulators <\/span>fined banks roughly $5 billion<\/span><\/a> for anti-money laundering failures. That\u2019s a 50% increase in fines issued a year earlier. In other words, after investing large sums of money to fix a problem, the problem persists.\u00a0<\/span><\/p>\n Banks clearly need a more effective alternative if they want to stay ahead of financial crime trends. This means adopting next-generation anti-money laundering solutions for next-generation challenges while causing minimal disruption to existing processes. That\u2019s how Feedzai\u2019s AML solution optimizes alerts for more effective compliance.<\/span><\/p>\n4 AML Challenges for Compliance Officers<\/span><\/h3>\n
Many Banks\u2019 AML Systems Were Built in the Pre-Digital Age<\/span><\/h4>\n
Compliance Officers Feel Burned Out<\/span><\/h4>\n
Despite Heavy AML Investments, Banks Still Face Fines\u00a0<\/span><\/h4>\n
Barriers to Embedding Machine Learning in AML<\/span><\/h4>\n