Cloud, AI and RPA bots – The K.I.T.T. in Financial Crimes Mitigation

The fight against financial crimes has been on for decades. Do you remember Michael Night? Those of us who grew up in the good old days of the 80s were probably huge fans of the American action crime drama TV series, Knight Rider.

The show starred David Hasselhoff as Michael Knight. The show intro began with the narration “Michael Knight, a young loner on a crusade to champion the cause of the innocent, the helpless, the powerless in a world of criminals who operate above the law.“

The sleek and modern fighter of both organized crime and financial crime, was assisted by KITT, an advanced, artificially intelligent, self-aware, and nearly indestructible car.

K.I.T.T.               

Every technology ever invented has been an extension or enhancement of human abilities. Same applied to KITT.

• KITT employed a Turbo Boost button. This was a pair of rocket boosters which lifted the car, allowing KITT to jump into the air and pass over obstacles in the road. Doesn’t this sound like the current Lift & Shift migration of Financial Crimes Mitigation applications into the Cloud? 
• The car was also powered by an AI computer processor and could drive itself without a driver. The resemblance with the modern AI algorithms in Financial Crimes Mitigation, supervised/unsupervised machine learning, AutoML and MLops is uncanny. 
• KITT could also operate in an Automated Silent Mode, making it undercover during covert missions. This feature was particularly useful when discretion was required. This resembles what RPA bots silently do today under the radar, when applied to facilitate Investigations. 

In the world of modern finance, where criminals continuously evolve their tactics, firms shall make the leap to embrace Cloud, AI and RPA to fight Financial Crimes. Much like KITT, financial systems can be equipped with advanced technologies that act as vigilant guardians.

Cloud               

• Cloud technologies play a crucial role in enhancing Financial Crimes Mitgation efforts by providing scalable, flexible, and secure solutions.
• Cloud-based Event Streaming technologies facilitate real-time monitoring of financial transactions, enabling immediate detection of suspicious activities.
• Cloud-based Collaboration Tools enable secure information sharing among financial institutions, regulatory bodies, and law enforcement agencies, fostering a collective approach to combating financial crimes.
• Cloud services operate on a Pay-As-You-Go model, allowing financial institutions to optimize costs based on usage. This is particularly beneficial for organizations with varying workloads. 
• Also, Cloud environments provide the Computational Power needed to train and optimize machine learning models for money laundering risk assessment and fraud detection.

AI               

• AI serves as the digital counterpart identifying either established fraud/money laundering patterns, or new anomalies that human eyes might miss. Ai’s ability to process vast amounts of data in real-time makes it an indispensable ally in the fight against financial crimes.
  The battle against financial crimes is dynamic, with criminals employing sophisticated techniques and subsequently AI evolves its models to stay ahead of emerging threats.

• AI can also be used in Entity Resolution, and enhances the accuracy and efficiency of relevant processes by applying Classification Algorithms to categorize records as matching or non-matching based on features extracted from the data, or by deploying Text Analysis (NLP) to identify similar entities even when there are variations in names, addresses, or other textual attributes, or by applying Probabilistic Matching to assess the likelihood of two records representing the same entity considering uncertainties and variations in the data.
• Precision LLMs (Large Language Models) can also be used to evaluate the risk profiles of entities (people and organizations) with the highest degree of speed and accuracy. Organizations can be empowered to make data-driven decisions with precise risk intelligence platforms that identify entity associations with fraud, financial crimes, trafficking, foreign investments, tax evasion, legal proceedings, gambling, and many other risk factors.

RPA bots               

• By integrating RPA into Financial Crimes Mitigation processes, firms can achieve greater efficiency, accuracy, and consistency, allowing human analysts to focus on more complex tasks that require critical thinking and decision-making.
• Investigations, Case Triage and Documentation: RPA bots can assist in the triage of AML cases by automating routine tasks, such as gathering information from various sources, updating case notes, preparing documentation for investigators, streamlining, and automating investigation workflows etc.
• Automated Third-Party Risk Assessments: RPA bots can streamline the process of conducting due diligence on third-party entities by automating the collection and analysis of relevant information.
• Automated SAR Preparation: RPA bots can assist in the preparation of Suspicious Activity Reports (SARs) by automating the extraction and composition of relevant data, facilitating faster reporting to regulatory authorities.

By harnessing the power of Cloud, AI & RPA technologies, financial institutions can build more robust, efficient, and adaptive systems for Financial Crimes Mitigation, ultimately enhancing security and protecting against emerging threats. 

Client benefits include strengthening of their defence mechanisms, identification of existing malicious actors and their networks, deterrence of potential new money launderers or fraudsters, response to previously unknown risks, suspicious alerts less than 0.5% of transactions, fewer regulatory audits and fines, while complying with confidence.

Matrix-IFS focus (https://matrix-ifs.com) lies in simplifying, customizing and optimizing your AML and Anti-Fraud systems to address your specific challenges; whether this is to reduce your false positives, increase the true positives, speed up investigations, increase your SAR conversion rate etc. We partner with all established and niche AML and Fraud software vendors and we provide targeted services ; from Advisory, to Software Configuration, Implementation, System Integration, Data Quality, Optimization Services, Model Tuning/Validation, Automation, Managed Services (FIU, RTB), or plain Staff Augmentation. 

We arm you with a pool of dedicated and expert resources acting as modern Knight Riders and assist you in navigating your AML and Fraud challenges. We are on the same mission as you, we have assisted more than 500 banks worldwide to combat financial crimes.

A few more interesting facts about KITT:

• Of all the cars used for the show, only 5 remain. One of those 5 original TV cars came to the public eye in 2020, as the vehicle was up for sale in an auction. A private collector scooped it up, paying $192,000 to add the futuristic model to their garage.
• KITT was so ahead of its time. A lot of its features are in today’s cars – self driving, navigation, communication etc. But, there is also something truly magical about the show intro and the narrator’s voice; it remains an immortal musical piece and legendary theme.
  https://www.youtube.com/watch?v=oNyXYPhnUIs

Authored by George Epidexios, Client Director at Matrix-IFS UK

Matrix International Financial Services (Matrix-IFS) provides financial crime and compliance solutions & services for the financial sector, serving many of the world’s top tier institutions.

We advise customers on business and technology challenges in anti-money laundering, risk management, fraud prevention, business intelligence and trade-surveillance, enabling our clients to Plan, Implement and Maintain highly efficient and effective financial crime prevention systems and processes.

Matrix-IFS is the only service provider that offers complete anti-financial crime solutions including advisory, system implementation/integration, automation, data quality, model tuning/validation, and Managed Services (FIU, RTB, and more).