Anti Money Laundering Reporting and Investigation – Sorting the Wheat from the Chaff

Abstract

The collection and analysis of financial data, referred to as financial intelligence, is gaining recognition has a key tool in the war on crime in general and terrorism in particular. Money in electronic form leaves a trail which means that individuals cannot easily disappear. There is a burgeoning industry providing sophisticated computer technology and complex mathematical models to mine financial data and single out unusual patterns of transactions. The use of automated monitoring systems is often seen as a powerful ally in the fight against money laundering and terrorist financing, justified by the increase in size of the typical transactional database, and by a desire to keep compliance costs under control. However, the power of automated profiling can result in negative outcomes such as over-reporting and increased expenditure on manual compliance checking.