Banks start using information-sharing tools to detect financial crime
Technology can help banks team up to find money launderers, but the legal basis for information-sharing is murky in many countries
Banks have long struggled to spot illicit transactions among the multitudes they process daily because criminals move dirty money from one institution to another to cover their tracks, leaving compliance staff with only a partial road map of their actions.
That has started to change, with financial institutions and service providers in several countries creating information-sharing platforms and messaging tools with the potential to vastly improve the detection of money laundering and fraud.
A research project supported by the Royal United Services Institute, a U.K. think tank, has identified at least 15 information-sharing initiatives around the world. Although most countries don’t allow banks to share information, several recent efforts have shown significant success in identifying crime, according to the Future of Financial Intelligence Sharing project.
Countries with information-sharing platforms include the U.S., U.K., the Netherlands and Estonia. The types, uses and origins of the platforms studied by FFIS vary widely. Some focus on specific problems, like money mules, or simply offer secure messaging to participating banks. Others have brought sophisticated technology to bear to help banks comply with far-reaching anti-money-laundering obligations.
