The AI in AML Journal: Volume 1

Welcome to the inaugural issue of the AI in AML Journal. We distribute it via email, but will replicate it here on its quarterly cadence. Through this journal we will document some of the interesting work in AI and its application to AML and other financial crimes.

This inaugural edition features work by the IIF, Ayasdi, and Dow Jones. Of particular note is the pioneering work done by HSBC in the AML area. They have used unsupervised learning to re-imagine AML’s most significant lever point, segmentation – with extraordinary success.

Going forward we will seek out the best content in this area from academic work to real world examples. Please don’t hesitate to nominate content or get added to our email list for future issues – just hit us up at social@ayasdi.com and we will add you or your content.

First up is Read Anna Irrera’s widely syndicated coverage of HSBC’s innovative AI work on the AML front. HSBC is the first bank to openly discuss how they are applying AI to solve the challenge of segmentation and media around the world picked up on the story.

Second, is the IIF’s excellent report “Deploying Regtech Against Financial Crime.” This superb peice covers the various technologies and approaches that are transforming the financial crimes arena as well as the policy challenges that face banks and regulators.

The third content item in this quarter’s journal is our technical post on the HSBC work. The post details the analytical approach that yielded the remarkable false positive decreases seen at HSBC including a discussion of why K-Means Clustering struggles to perform in an AML environment.

The fourth item is the Dow Jones + SWIFT Global Anti-Money Laundering Survey Results for 2017. A must read for practitioners the report covers where our colleagues see the industry going and details the key trends. More than 60% of respondents feel like RegTech technologies are improving capabilities and more than half will be increasing investment. We think that is low.

The final installment is the G7’s statement on the Fight Against Terrorism and Violent Extremism that was issued recently. In the wake of Manchester, London, and other global terrorist events, there will be increased attention paid to combating the financing of terrorism. Shutting off the money spigot is one of the most powerful, effective, and sustainable tools in the hands of governments and banks.

That concludes the inaugrual issue. We are keen to get your feedback and encourage you share your thoughts with us via email or on your social channels.