Product: AML Transaction Monitoring
Company: Hawk AI
Hawk AI, a global provider of advanced anti-fraud solutions, enhanced its AML (anti-money laundering) Transaction Monitoring. Designed to reduce false positives and detect outlier behavior, the solution combines a rules-based approach with machine learning and explainable AI, according to Michael Doron, managing director at Hawk AI.
"FinCEN advocates the use of technology to fight money laundering but requires 'explainability' in the decisioning process," Doron said. "If you're sitting across the table from an auditor, you need to be able to explain how and why an operator decided on an alert. We provide easy to understand, natural language that explains AI decisioning." Doron additionally noted that Hawk AI's fraud suite complements the company's technology stack, and clients can selectively implement modules, including comprehensive data screening, customizable rule sets, machine learning and contextual replays to detect anomalies.
Experienced Hawk AI leaders previously built PAY.ON, an SaaS-based international gateway acquired by ACI Worldwide in 2015. Today, the company provides network analysis and federated pattern sharing to acquirers, processors, ISOs, ISVs, payment facilitators, technology platform enablers, money service businesses and financial institutions, Doron noted. "FinCEN advocates making it easier for financial institutions to share information to identify bad actors and let them use technology to help detect suspicious activity more efficiently without breaching privacy laws," Doron said. "We strongly believe good actors need to band together to fight financial and organized crime and get it out of our payment institutions."
Doron went on to say that Hawk AI solutions are intuitive, flexible and easy to implement, and the company's developer portal, sandbox environment and RESTful API facilitate fast integrations. In a matter of months, partners can be up and running, monitoring the entire transaction lifecycle, from onboarding and KYC, through transaction monitoring, to automated SAR filings using a built-in SAR e-filing tool, he added
Created by knowledgeable industry leaders, the platform can significantly reduce costs and time to market while easily fitting into existing compliance infrastructures, and its software-as-a-service subscription model makes it easy to maintain, update and deploy, Doron stated. When changes and new rules become available, Hawk AI swiftly implements and updates systems to stop perpetrators and keep participating members compliant.
The "explainability" factor builds trust and helps bring transparency by making AI decisions understandable to humans, Doron noted, adding that the system documents interactions and case reports for auditors and regulators. These improved efficiencies, combined with machine learning that reduces false positives and detects anomalies can further reduce caseloads and related costs while improving detection, he added.
Hawk AI's expanding database, ready-to-apply models from a shared pattern repository, and anomaly detection provide insights that companies would never have identified without the assistance of advanced technologies, Doron stated. Hawk AI's unsupervised methodology can reduce false positives by up to 70 percent, he added, noting that a growing digital economy requires robust digital payments infrastructure.
Rules by themselves cannot detect outliers. As individuals and organizations acclimate to digital-first environments, Hawk AI's fraud suite and AML transaction monitoring will easily scale and adapt to ever-changing needs and regulatory requirements, Doron stated. "As more FIs and countries adopt local and cross-border real-time payment systems, we will see payments continue to clear and settle faster," Doron said. "We'll also see payments become more embedded in the business processes they serve, making the process of initiating payments faster and easier for end customers."
As he reflected on payments industry trends, Doron noted that mergers and acquisitions have left payment providers with multiple platforms, sponsoring banks and legacy solutions, many of which cannot evolve and adapt to new, complex scenarios and ever-changing AML regulations. As bad actors continue to challenge traditional rule-based systems and exploit new entry points, Hawk AI has the know-how and experience to develop, scale and continuously adapt, he said.
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