MOUNTAIN VIEW, Calif.–Google Cloud has introduced new artificial intelligence-based technology aimed at offering an anti-money-laundering solution.
“Like many other tools already on the market, the company’s technology uses machine learning to help clients in the financial sector comply with regulations that require them to screen for and report potentially suspicious activity,” the Wall Street Journal reported. “Where Google Cloud aims to set itself apart is by doing away with the rules-based programming that is typically an integral part of setting up and maintaining an anti-money-laundering surveillance program—a design choice that goes against the prevailing approach to such tools and could be subject to skepticism from some quarters of the industry.”
Notable Users
According to the report, the product, an application programming interface dubbed Anti Money Laundering AI, already has some notable users, including London-based HSBC, Brazil’s Banco Bradesco and Lunar, a Denmark-based digital bank.
“Google Cloud’s decision to do away with rules-based inputs to guide what its surveillance tool should be looking for is a bet on AI’s power to solve a problem that has dogged the financial sector for years,” the Journal reported. “Depending on how they are calibrated, a financial institution’s anti-money-laundering tools can flag too little or too much activity. Too few alerts can lead to questions—or worse—from regulators. Too many can overwhelm a bank’s compliance staff, which is tasked with reviewing each hit and deciding whether to file a report to regulators.”
Google Cloud executives told the Journal the issue is that manually inputted rules drive up those numbers.
Reduction in False Positive
“A user, for example, could tell the program to flag customers that deposit more than $10,000 or send multiple transactions of the same amount to over 10 accounts,” the report explained. “As a result, the number of system-generated alerts that turn out to be bad leads, or what the industry calls ‘false positives,’ tends to be high.”
With Google Cloud’s product, users won’t be able to input rules, but they will be able to customize the tool using their own risk indicators or typologies, executives told the Journal, adding that with its AI-first approach, Google Cloud is reporting its technology cut the number of alerts HSBC received by as much as 60%, while increasing their accuracy.
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