FinCEN Strengthens Commitment to Digital Innovation

Terri Luttrell, CAMS-Audit
February 27, 2020
Read Time: min

The Financial Crimes Enforcement Network (FinCEN), along with the Federal Banking Agencies, released a joint statement in December 2018 emphasizing financial institutions’ need to embrace technology to strengthen their BSA/AML programs. It seems FinCEN took its own advice as they announced the appointment of Michael Mosier as Deputy Director and Digital Innovation Officer, the first in the history of the agency. Mosier will oversee FinCEN’s work to protect the financial integrity and national security of the United States by advancing the agency’s engagement with new technologies within the financial industry.

Emerging technologies and financial innovation have been at the forefront of the anti-money laundering and anti-financial crimes community for several years. The joint statement released in December 2018 encouraged the financial industry to pursue innovative technologies as applied to AML compliance, including the adoption of artificial intelligence. FinCEN recognizes that innovation can help the banking industry identify and report money laundering, terrorist financing, and other illicit financial activities. The agency encourages and welcomes innovation to improve efficiencies in areas such as risk identification, transaction monitoring, and suspicious activity reporting while maintaining strong BSA/AML programs.

Abrigo Embraces Innovation with Machine Learning Scenarios

At Abrigo, we understand the important role technology plays in strengthening BSA/AML programs to better protect our financial system. We heard the innovation call and we’re excited to offer transparent machine learning scenarios within BAM+. So, what exactly is machine learning in the context of AML compliance? Artificial intelligence is broadly defined as a machine process that makes predictions or takes action based on data by using certain algorithms. Machine learning (ML) is what makes AI possible when teaching machines to make decisions based on this data. ML can offer significant gains in the financial crimes detection world because with large enough data sets, ML can piece together activity and relationships that would not be found otherwise. While human intervention will always be necessary in financial crimes, won’t it be great if your software took care of the easy processes so you can spend your time and resources on more complex decision making?

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Transparent AI means you understand the system

Transparency is what differentiates Abrigo AI against other BSA/AML software. We don’t believe in black boxes for any of our product enhancements. You must be able to understand how your software works to be able to explain it to your auditors and examiners. Abrigo will work with your institution to provide valuable information, including technical documents and details, clarifying how our AI models work.

AI will never replace the human element of suspicious activity monitoring, but ML is a tool to help you do your job more accurately and more efficiently. Abrigo is committed to bringing a strong comfort level for your institution to use the new scenarios and the innovation that Abrigo brings you while maintaining a strong BSA/AML program. Our hope is that you will experience fewer false positives and other efficiencies in your processes and have time for the more important analyses to better protect our financial system from bad actors.

About the Author

Terri Luttrell, CAMS-Audit

Terri Luttrell is a seasoned AML professional and former director and AML/OFAC officer with over 20 years in the banking industry, working both in medium and large community and commercial banks ranging from $2 billion to $330 billion in asset size. She has successfully worked with institutions in developing BSA/OFAC programs, optimizing various automated solutions, and streamlining processes while ensuring all regulatory requirements are met. As the Compliance and Engagement Director at Abrigo, Terri provides insights that contribute and support long-term banking strategies based on analysis of market and industry trends, competitor developments, and financial and regulatory technology changes. She is an audit-certified anti-money laundering specialist and a board member of the Central Texas chapter of the Association of Certified Anti-Money Laundering Specialists (ACAMS). Terri earned her bachelor’s degree in business administration, specializing in business and finance, from the University of North Texas.

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Abrigo is a leading technology provider of compliance, credit risk, and lending solutions that community financial institutions use to manage risk and drive growth. Our software automates key processes — from anti-money laundering to fraud detection to lending solutions — empowering our customers by addressing their Enterprise Risk Management needs.

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