Joe Depeau, Neo4j

1. How to Improve Anti-Money
Laundering Investigation
using Neo4j
Joe Depeau
Sr. Presales Consultant, UK
6th December, 2018
@joedepeau
http://linkedin.com/in/joedepeau

2. • What is Money Laundering?
• Anti-Money Laundering regulations
• Typical problems with Anti-Money Laundering
processes
• How Neo4j can help with Anti-Money Laundering
• Demo
• Q & A
2
Agenda

3. What is Money
Laundering?
3

4. 4
LOL! But seriously …

5. 5
What is Money Laundering?
“Money laundering is the act of concealing the transformation of profits from illegal
activities and corruption into ostensibly ‘legitimate’ assets.
One problem of criminal activities is accounting for the proceeds without raising the
suspicion of law enforcement agencies. Considerable time and effort may be put into
strategies which enable the safe use of those proceeds without raising unwanted suspicion.
Implementing such strategies is generally called money laundering.
After money has been suitably laundered or ‘cleaned’, it can be used in the mainstream
economy for accumulation of wealth, such as by acquisitions of properties or legitimate
businesses, or simply spent.”
Source: Wikipedia, 27th November 2018

6. 6
Who needs to launder money?
• Terrorists
• Embezzlers
• Drug cartels
• Fraudsters
• Illegal gamblers
• Thieves
• Tax evaders
• Corrupt officials
• Human traffickers
• Criminal gangs
Anyone who wants to “clean” their illegally obtained profits
so they can be used in the legitimate economy without raising suspicion
• Smugglers
• Blackmailers
• Counterfeiters
• Illegal arms dealers
• Sanctioned individuals

7. Anti-Money Laundering
Regulations
7

8. 8
Examples of AML laws and regulations
United Nations Convention
Against Transnational
Organized Crime (UNTOC)
The Money Laundering, Terrorist Financing, and Transfer of
Funds (Information on the Payer) Regulations 2017
United Nations Convention
Against Corruption (UNCAC)
The Bank Secrecy
Act (BSA)
EU Directive 2015
(Fourth EU Money
Laundering Directive)
United Nations Convention Against Illicit Traffic
in Narcotic Drugs and Psychotropic Substances
Financial Action Task Force
(FATF) Recommendations

9. 9
The penalties are serious
Source: bbc.co.ukSource: kyc360.com Source: uk.reuters.com

10. 10
Pillars of AML
AML
Policies and
Processes
Know Your
Customer
(KYC)
Due
Diligence
(CDD / EDD)
Risk
Evaluation
Transaction
Monitoring
Reporting
and
Compliance
Supervision
and
Monitoring

11. Typical Problems with
Anti-Money
Laundering processes
11

12. 12
“Don’t consider traditional technology
adequate to keep up with criminal trends”
Market Guide for Online Fraud Detection, April 27, 2015

13. 13
INVESTIGATE
INVESTIGATE
Normal behavior
AML with Discrete Analysis
Transaction Volume
TransactionValue

14. 14
AML with Discrete Analysis
• High number of false positives
• Poor data quality can hinder investigations
• Harder to spot suspicious patterns of behavior
• Identifying money laundering rings is more difficult
• Developing a complete view of complex data across
silos is a major challenge
• Easier to avoid detection

15. 15
Normal behavior
AML with Connected Analysis
Transaction Volume
TransactionValue
Fraudulent pattern

16. 16
AML with Connected Analysis
• Fewer false positives
• Use full data context instead of discrete data points
• Entity Resolution using patterns helps manage data
quality issues
• Easier to spot suspicious patterns of behavior
• Identify money laundering rings quickly and more easily
• Develop a complete view of complex data across silos
using the graph
• Harder to avoid detection

17. How Neo4j can help
with Anti-Money
Laundering
17

18. 18

19. Blank Slide
19

20. Demo
20

21. Q & A
21