https://www.pymnts.com/aml/2024/oracle-introduces-artificial-intelligence-powered-anti-money-laundering-service-banks/

Oracle Financial Services introduced an artificial intelligence-powered cloud service that helps banks mitigate anti-money laundering (AML) risks.

The new Oracle Financial Services Compliance Agent “identifies and remediates vulnerabilities,” the company said in a Monday (April 8) press release.

“Putting Compliance Agent in the hands of financial-crime compliance officers will help enable banks to thwart potential money laundering opportunities more quickly and economically,” Jason Wynne, global vice president of finance, risk and compliance product development at Oracle Financial Services, said in the release.

The new cloud service enables banks to run inexpensive, hypothetical scenario testing to adjust thresholds and controls, according to the release. With that testing, banks can sort through transactions, identify suspicious activity and better meet their compliance requirements.

The Compliance Agent helps banks assess and optimize the performance of their transaction monitoring systems, the release said.

Using the service, banks can evaluate and measure the AML risk profile of new products, evaluate controls to mitigate the risk of those products, proactively assess and mitigate risks from high-risk typologies, and make quicker, cheaper compliance decisions, per the release.

“AI and machine learning have tremendous potential to increase the effectiveness of anti-money laundering and other financial crime detection programs to deliver higher efficiencies in the transactional modeling process,” Wynne said in the release.

PYMNTS Intelligence found that AI has become a tool of choice for financial institution executives looking to combat money laundering, bank fraud and other illicit activities.

Seventy-one percent of financial institutions are now using AI and machine learning to fend off fraudsters, according to PYMNTS Intelligence’s “Financial Institutions Revamping Technologies to Fight Financial Crimes.”

The report also found that more than 40% of financial institutions said incidents of fraud are increasing.

In another deployment of this technology, OTTO Payments, the payments division serving the OTTO marketplace, said in December that it adopted Hawk AI’s solutions for AML compliance. Hawk AI’s AML solution features the company’s explainable AI and intuitive user interface.

In June, Google said it launched an AI-powered tool to help financial institutions detect money laundering. The company’s Anti-Money Laundering AI provides a customer risk score as an alternative to rules-based transaction alerting and can adapt to changes in underlying data to deliver more accurate results.