Learning more about fraud-detection from the Eliot Spitzer case

Bookmark Blog Post

	del.icio.us
	Digg
	DZone
	Furl
	Reddit

Jesper Joergensen's Blog | March 24, 2008  12:04 PM | Comments (0)

This article in Technology Review, published by MIT has even more information about the anti-money laundering systems that caught Eliot Spitzer. We regularly get requests for what role a BPM Suite plays in anti-money laundering solutions and the article provides a good context to understand the role of BPM.

First you need to funnel an enormous stream of events from their sources (credit card transactions, account transfers, deposits, etc) to a system that applies all the sophisticated algorithms that detect unusual patterns. This part requires complex event processing as a foundation, but CEP itself is probably not enough and BPM Suite technology is most likely not relevant at all for this job.

A BPM Suite is more likely to be involved when the algorithm detects suspicious activity. This triggers a business process that routes the case to a dedicated group of people for review. The BPM Suite can enrich the record with any relevant information on the customer before it's presented for review. Reviews could be tiered or scheduled in parallel (for additional fidelity) or both. All this would be modeled as a business process and with a BPM Suite this process can be easily integrated to the upstream fraud-detection system that triggered it, the downstream systems that would further process the case (such as the FinCen) and systems in between that can provide additional data or that needs to be updated as part of the process. The human workflow controlled by the task management component of the BPMS and all activity can be monitored to measure resource utilization, guarantee internal SLAs and document regulatory compliance.

In 2006, banks filed a record 567,080 "Suspicious Activity Reports" (SARs) and 2007 is on track set a new record. These are the filtered activities after bank personnel has reviewed activity flagged by the fraud-detection algorithms. For each of these reports, the bank has reviewed many times more activities flagged by their internal systems. This is the work that the BPM Suite can automate, manage and measure.

Comments