Magazine article Business Credit
Money Laundering Solution for Financial Institutions: Falcon for Money Laundering to Battle $1 Trillion Problem. (Communique)
According to Secretary of State Colin L. Powell, winning the war on terrorism will involve more than military actions. The challenge for the civilized world will be "going after, and dealing with, the sources of support that terrorists have."
Some of their money comes from money laundered illegally in the U.S. and other countries. Experts agree that money laundering poses a serious, growing threat. A recent report by TowerGroup labels money laundering as "one of the world's largest businesses" and notes that roughly $1 trillion is laundered annually; about half of which passes through the U.S. The report says the problem will grow especially in Europe and Latin America in the years ahead. Meanwhile, law enforcement officials have established that criminals are actively targeting institutions that have weak or ineffective money laundering countermeasures.
"Criminals are becoming increasingly sophisticated in their money laundering tactics and use of advanced technology, making money laundering progressively more difficult to detect. In addition, as web-based payment products and services expand, the opportunity for new and creative money laundering activities will continue to increase," said Breffni McGuire, senior analyst with TowerGroup.
"Neural network solutions, especially those incorporating rules-based engines, offer financial institutions a very powerful tool to understand customer behavior and differentiate between legitimate and potentially criminal activity." Money laundering poses a considerable threat to the world's financial institutions in the forms of severe regulatory fines, legal action, higher insurance premiums and tarnished reputations.
The regulatory environment for money laundering is also evolving, and more stringent enforcement of laws is gaining momentum. Penalties against U.S. banks have ranged from a few hundred dollars to almost $5 million (U. …