Predicting and acting upon financial fraud is one of the prime areas of application of advanced big data techniques like machine learning (ML). Earlier this week, a case of money laundering known as the Laundromat was uncovered by the Organized Crime and Corruption Reporting Project (OCCRP) involving a number of global banks active in the UK. Could ML help prevent such incidents? What progress is there on this front, how does it fit in the bigger picture, what are the roadblocks, and what may be the repercussions of adoption? There are many different types of fraud related to the financial industry.

The CEO and founder of cloud-based accountancy software giant Xero says artificial intelligence (AI) and machine learning technologies will be "transformational" for finance over the next few years. Rod Drury told Business Insider during a recent interview in London: "We'll see more innovation in the next 2 years than we have in the 10 years, all driven by AI." The Xero founder says: "We're getting a massive hit on the R&D we've done around machine learning and AI. We think it's going to be transformational for the industry. "If you capture information from the bank statement and the invoice and the bills that are flying through, you can actually programme things to do a whole lot of work for you and you're just checking and making fixes, which trains the machine." Xero's accountancy software helps small and medium-sized businesses manage their accountants in the cloud but Drury believes much of the management -- things like categorizing expenditure and sending accounts to be checked -- could be automated by "smart" AI and machine learning programmes, which learn the habits of your business. "You can build unique system for each business," says Drury. "The first innovation in cloud accounting was actually getting these transactions into the cloud.

There is no denying 2015 was Fintech's year. Every start startup or VC conference had at least one panel dedicated to the subject. It is usually defined as subset of the tech universe which is focused on disrupting debt and equity transactions, payments, transfers, as well as asset management – basically applying disruptive technology to the financial services sector. According to Accenture investment in fintech reached more than 12Bn by the end of 2014 and the hottest fintech market in 2015 was Europe, where investments grew by more than 200% compared to a year earlier. In a strange twist, banks, and other financial institutions are already calling for more regulations to protect their industry from further disruption.