Detecting Money Laundering

Financial institutions have a regulatory requirement to monitor account activity for anti-money laundering (AML). Regulators take the monitoring and reporting requirements very seriously as evidenced by a recent set of FinCEN fines. One challenge with AML is that it rarely manifests as the activity of a single person, business, account, or a transaction. Therefore detection requires behavioral pattern analysis of transactions occurring over time and involving a set of (not obviously) related real-world entities. For large transactions, banks file Currency Transaction Reports (CTR) that are used by FinCEN for processing and analysis.