How to Triple Your AML Bet … and Win

What Casinos Can Learn From Banks

According to the latest evidence, The US Treasury estimates that over $300 billion in money laundering flows through casinos annually.  The two leading sources of funds, fraud or drug trafficking, account for just over $64 billion alone.    Recently, officials at the federal Financial Crimes Enforcement Network (FinCEN) – the agency responsible for monitoring casino operator compliance with the Bank Secrecy Act of 1970- have stepped up their AML compliance rhetoric and activity.   And they’re not alone.

In the Philippines, a major money-laundering scandal involving stolen, sovereign funds from Bangladesh – performed through weakly regulated casino operations – has called attention to the potential for widespread organizational and individual money laundering in normal casino operations.  It’s also pointed out the perils of inconsistently deployed monitoring and review processes – reminding regulators of the ‘weakest link’ in any AML chain.

Though banks get most of the attention, other institutions (like casinos or investment managers) that handle large amount transactions (especially cash) are the object of heightened scrutiny. Banks are learning and innovating to meet rising regulatory expectations – by focusing on the productivity of AML case investigators.  Like banks, casinos rely upon human review to decide which cases to submit to regulators and law enforcement – so they can take advantage of what banks have learned.  And literally, get more from less.

There’s a Hole in the Bucket…

 First, a quick reminder from last week’s AML post - the most recent WSJ/ACAMS survey of AML compliance executives identified competent staffing as the second greatest challenge they face.  Despite prolonged and significant investment in monitoring and case management systems, banks have watched AML backlogs grow and exposure to regulatory sanction increase.

To combat that challenge, several prominent banks have targeted the complexity of the tasks they’re asking AML investigators to perform.  If investigators are asked to consult dozens of screens to collect evidence with bearing on the case they’re investigating – then, compose a case summary and an audit narrative that organize the evidence – then review, weigh, and decide whether to close or escalate – technology should offer a way to accelerate the process.

Casinos, like banks, can collect every relevant fact from dozens of separate applications or databases and organize it into consistent document that summarizes and narrates in a format that analysts and regulators can quickly digest.   How powerful can that simple addition be?

In one global bank, analyst productivity has increased three-fold (four cases close in the time it took to close one).  Analysts spend MORE time analyzing evidence, increasing the likelihood of a more accurate assessment and improving the certainty of the investigation.  Like banks, casinos will appreciate the ability to increase their monthly processing capacity, dramatically, without increasing operating expense. 

Stand Pat

There’s no reason this solution won’t work for every institution facing AML compliance requirements under the BSA.  Attivio has just launched a focused solution for accelerating AML investigation – precisely by collecting facts from all relevant sources and automatically organizing it to help your investigators – gathering, analyzing, and communicating evidence at enterprise- or global-scale.  For an outline of the solution, consult our new eBook. 

Most importantly, the solution is compatible with any existing combination of transaction monitoring, case management and KYC solutions you deploy.  And you could save millions.

Money laundering is the last step in any number of things we’d all like to eliminate – funding terrorism, international narcotics, human trafficking.  With this solution, casinos can become an effective frontline of defense - making it harder for the bad guys to profit from their crimes.