Lawmakers Push for Artificial Intelligence to Combat Financial Crimes

In a letter to the Financial Crimes Enforcement Network (FinCEN), a group of lawmakers requested a briefing on ways law enforcement can use artificial intelligence (AI) and machine learning (ML) in investigative work. This initiative follows several pushes by the White House and agencies to increase use of technology to combat financial crimes.

The letter praised multi-agency efforts to create collaborative arrangements with banks and credit unions to track financial crimes effectively. The letter then advocated that agencies move a step further to use AI and ML technology.

“The achievements of AI and ML in other compliance areas have proven the ability to mine data faster with more consistent accuracy at lower costs while detecting criminal patterns for evasion more quickly. We have become aware of public/private sector initiatives that use collaborative AI and ML automation technology to streamline fraud detection across multiple banks and credit unions,” the letter-writers state.

The letter predicts that AI and ML technology would allow agencies to better respond to evolving criminal activity and reduce the number of false positive fraud alerts and investigations.

In the president’s recently released proposed budget, President Trump also pushed focus onto technology which can be used to combat financial crimes. The budget offers the Treasury Department FinCEN division $125 million to handle cryptocurrency and digital crime.

In December 2018, a joint press release from the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, FinCEN, National Credit Union Administration, and the Office of the Comptroller of the Currency encouraged banks to consider innovative, technological approaches to meet Bank Secrecy Act/anti-money laundering (BSA/AML) compliance obligations.

The statement explains, “Some banks are becoming increasingly sophisticated in their approaches to identifying suspicious activity, commensurate with their risk profiles, for example, by building or enhancing innovative internal financial intelligence units devoted to identifying complex and strategic illicit finance vulnerabilities and threats. Some banks are also experimenting with artificial intelligence and digital identity technologies applicable to their BSA/AML compliance programs. These innovations and technologies can strengthen BSA/AML compliance approaches, as well as enhance transaction monitoring systems.”

The agencies discuss the importance of collaboration and modernization in order to combat crimes such as money laundering, terrorist financing, and fraud.

Ultimately, the letter penned by lawmakers requests that FinCEN provide a briefing on the actions the group is taking “to utilize AI and ML technology as part of its investigative work, the steps being taken to encourage collaboration among banks, and how FinCEN would participate in a collaborative AI initiative for BSA/AML compliance.”

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