What does SAS® Anti-Money Laundering do?

SAS Anti-Money Laundering takes a risk-based approach to monitoring transactions for illicit activity and helps banks and other financial institutions comply with anti-money laundering (AML) and counterterrorist financing (CTF) regulations. The solution uses high-performance analytics and multiple detection methods, enabling the institution to monitor more risks against very large volumes of data in less time. Once suspicious behavior is identified, a seamless workflow increases the effectiveness and efficiency of the investigative function.

Why is SAS® Anti-Money Laundering important?

SAS Anti-Money Laundering dramatically reduces scenario time frames from hours to minutes by incorporating high-performance analytics with supercharged scenario tuning and what-if analysis into a unified technology platform that brings together the key capabilities of an end-to-end AML technology solution. As a result, investigators can spend their valuable time on the most critical cases.

For whom is SAS® Anti-Money Laundering designed?

SAS Anti-Money Laundering is designed for AML/CTF compliance departments within financial institutions.

SAS® Anti-Money Laundering

Complete money laundering protection, full anti-money laundering compliance and the power of high-performance analytics

More stringent regulatory requirements have spurred many financial institutions to re-evaluate their current anti-money laundering (AML) systems. However, it’s the high-profile enforcement actions behind those requirements that have motivated a widespread reassessment of the effectiveness of existing AML programs and efforts to identify gaps in control and oversight.

Only SAS offers a comprehensive AML solution that covers all key areas – including suspicious activity monitoring, customer due diligence and watch-list filtering – and all steps involved in AML processes. By combining context-specific intellectual property, SAS High-Performance Analytics and SAS Foundation technologies, SAS Anti-Money Laundering offers more complete protection and the ability to meet compliance demands with greater speed and accuracy than ever before.

Key Benefits

• Monitor more transactions in less time. Reduce scenario time frames from hours to minutes using high-performance analytic capabilities, so investigators can more expediently identify and focus on the most critical cases. With SAS, you can process more than 2 billion transactions in a single night. And because array pro-cessing lets you monitor multiple risks during a single pass of the data, you can add numerous scenarios and risk factors with little to no impact on pro-cessing time.

• Improve the quality and accuracy of alerts. Alerts are scored using predictive alert analytics prior to being passed on to investigators. This sig-nificantly reduces false-positive alerts,

reduces staffing hours required for alert triage, and more accurately identifies actions and relation-ships that present the greatest risk. Because this approach objectively and consistently escalates alerts to investigators, your audit and regula-tory risk is reduced.

• Enhance investigation speed and effectiveness. A configurable alert management hub provides a holistic view of work items, enabling more informed and efficient triage, and more timely risk mitigation. The intui-tive interface provides quick access to all information relevant to an inves-tigation in a way that is tailored to the role, rights and privileges of the user.

• Identify organized crime rings. Entity link analysis enables you to develop comprehensive customer risk profiles that incorporate all cross-channel account activity. By visualizing the cross-channel account activity of a network of account holders over any time period, you can identify – and prosecute – organized rings.

• Reduce AML compliance costs. Fewer false-positive alerts mean more efficient use of investigative resources. And reduced processing time frees computing resources for other uses, thereby reducing the total cost of ownership.

• Get up and running quickly. SAS Anti-Money Laundering includes a banking-specific data model opti-mized for financial crimes analytics and incorporates data management best practices from more than a hundred successful implementations, enabling a faster implementation time.

FACT SHEET

Product Overview

SAS Anti-Money Laundering is an integrated component of the SAS Financial Crimes Suite, offering a common technology platform to ease the sharing of data and analytics, while reducing administrative costs.

Data Management

SAS Anti-Money Laundering includes complete data management capabili-ties that can be easily managed via an intuitive interface. A proven, banking-specific data model maps transaction records to support transaction, account, customer and household dimensions. The data model includes the core schema for preparing all necessary data for nightly batch analysis, and a knowledge center data schema supports data retention and investiga-tion. In addition to transaction data, the solution also supports nonmonetary event data, geographic data, risk lists, third-party data, associate data and a variety of customer information data.

Suspicious Activity Monitoring and Reporting

SAS Anti-Money Laundering auto-mates the monitoring of customers and counterparties for potential money laundering or terrorist financing behav-ior, documents the decision process and – if applicable – automates the filing of reports to the appropriate authori-ties. A robust, flexible scenario engine automates transaction monitoring and behavior detection for SAR and CTR filing, and advanced analytics enable the creation of scenarios that use any of the following techniques:

• Rules.

• Peergrouping,clusteringandseg-mentation.

• Behavioralprofiling.

• Patternrecognition.

• Linkanalysis.

• Predictivemodeling(e.g.,linearand

logistic regression, decision trees and

neural networks).

All scenarios are parameterized, enabling you to configure thresholds to meet your institution’s specific needs. In addition, each scenario may be further constrained by any attribute available in the data – geography, account type, customer type, line-of-business, etc. – so that it only applies to specific groups of customers or accounts. Flexible suppression facilities enable scenarios to be suppressed at the company, account or customer level either auto-matically or by investigators through the investigation interface.

The system uses a powerful array processing method for alert generation that allows multiple scenarios to be deployed while making a single pass against the database. This means more risks can be monitored in a shorter period of time versus SQL-based systems that must perform numerous database scans.

Nightly batch routines run against the core data schema, which comprises a combination of account, party, house-hold, cash flow, associate, and CIP/KYC information. Selected scenarios are run against the core, and transactions that meet defined criteria become alerts.

A powerful ranking engine attached to the scenario engine allows each alert to be risk-ranked based on a variety of factors (e.g., customer or account risk, scenario risk, number of past alerts, or the probability that the alert will result in a SAR filing). This approach provides an objective and consistent means of re-ducing low-quality alerts and escalating meaningful alerts to investigation, thus reducing audit and regulatory risks.

Flexible ranking enables investigators to prioritize and focus their efforts on

those alerts that are of greatest con-cern. And by focusing on the highest scoring alerts, financial investigation units can reduce staff hours allocated to triage and devote more time to legiti-mate investigations.

Customer Due Diligence/Know Your Customer Risk Scoring and Classification

SAS Anti-Money Laundering automates the process of integrating a customer’s on-board risk score with actual transac-tional behavior, and supports enhanced customer due diligence by allowing high- and medium-risk customers to be monitored more stringently.

The solution uses SAS models to derive Know Your Customer (KYC) risk scores based on a customer’s onboarding responses, and then stores the KYC scores for later use. Analysts can then reassess a customer’s risk classification periodically (e.g., annually or semiannu-ally) or as needed.

Compliance analysts can also create new classifiers whenever necessary using the solutions risk classification component – without having to involve IT staff. In addition, the solution:

• Comespre-populatedwithsamplesthat mirror the examples in the FFIEC BSA/AML examination manual.

• Enablesenduserstodeploysce-

narios based on KYC risk segments.

Watch-List Filtering and Support for Dow Jones Watchlist

SAS Anti-Money Laundering imports sanctions and other watch lists to identify individuals, organizations or high-risk jurisdictions that represent heightened regulatory risk. The solution uses fuzzy matching logic to increase the accuracy of entity matches, and it also lets you create complex matching rules for a custom, risk-based approach to client screening.

This functionality is combined with the Dow Jones Watchlist service, which provides leading compliance risk infor-mation in a format designed specifi-cally for automated screening and risk management.

Investigation/Alert Management

A Web-based investigation interface gives analysts easy access to the knowledge center database, which serves as the system of record for regu-latory and auditing purposes. Easy-to-use network visualization tools include a business intelligence dashboard that provides visual access to key perfor-mance indicators for a dynamic view of the most recent trends. Analysts can see a customer’s complete pattern of behavior so they can determine what’s normal for the subject, review triggering transactions, and access CIP and other demographic information as needed.

Having a clear description of why an alert was generated, along with sup-porting information, enables analysts to make decisions more quickly, consistently and efficiently. In addition, users can choose what information is displayed and can tailor its presenta-tion to their individual roles, rights and privileges for greater efficiency and increased productivity.

An administrative tab allows a “super user” to grant other users necessary rights and privileges, including the rout-ing and suppression of alerts and the creation and filing of SARs.

In addition to internally generated alerts, the system can display alerts generated by other transaction monitoring sys-tems. And conversely, alerts generated by SAS Anti-Money Laundering can be exported to third-party case manage-ment systems if desired.

Key Features

Data Management• Includesabanking-specificdatamodelthat:

– Mapstransactionrecordstosupporttransaction,account,customerandhouseholddimensions.– Includesthecoreschemaforpreparingdatafornightlybatchanalysis.

• Includesaknowledgecenterdataschemathatsupportsdataretentionandinvestigation.• Supportsmultipledatatypes(nonmonetaryeventdata,geographicdata,risklists,third-partydata,associatedataandavarietyofcustomerinformationdata)inadditiontotransactiondata.

High-Performance Analytics and Visualization• Providesstresstestingcapabilitiesforestimatingtheimpactsoffullenterprisecoverage.•Includesascenariobuilderfortesting,tuningandsimulatingscenariosinsecondsinsteadofhourstoimprovescenarioefficacywhileadheringtomodelgovernancebestpractices.

• Providesrapidaccesstocustomer,accountandtransactiondata.

Suspicious Activity Monitoring and Reporting• Appliesscenariosandriskfactorstotransactionstodetectpotentiallysuspiciousactivity.• Generatesalertsforeventsthatmeettheruleparameters.• Subjectsalertstoadditionalworkflowprocesses(e.g.,suppression,riskscoringandrouting).• Includesaneasy-to-use,point-and-clickinterfacethatenables:

– Easycreationandmodificationofscenariosandriskfactors.– Creationofcustomizedroutingrulesfordistributingtheworkloadtocomplianceanalysts.

Customer Due Diligence/Know Your Customer Risk Scoring and Classification• Automaticallyintegrateson-boardcustomerriskscoreswithactualtransactionalbehavior.• Enablesreassessmentofcustomerriskclassificationseithermanuallyoruponperiodicreview.• Documentsinformationgatheredduringenhancedduediligenceforamoreaccurateviewofmoneylaunderingrisk.

Watch List Matching• Importssanctionsandotherwatchliststoidentifypersons,organizationsorhigh-riskjurisdic-tionsthatrepresentregulatoryrisk.

• Usesfuzzymatchinglogictoincreasetheaccuracyofentitymatches.• Enablestransaction,partyorcounterpartymatchingliststobeworkedasalertsorcases.• CombinesfunctionalitywiththeDowJonesWatchlistservicetoprovideleadingcomplianceriskinformationinaformatdesignedforautomatedscreeningandriskmanagement.

Investigation/Alert Management• IncludesaWeb-basedinvestigationinterfacethatgivesanalystseasyaccesstotheknowledgecenterdatabase,whichservesasthesystemofrecordforregulatoryandauditingpurposes.

• Enables“superusers”tograntrightsandprivilegestootherusersviaanadministrativetab.• Displaysalertsgeneratedbyothertransactionmonitoringsystems.• Exportsalertsgeneratedbythesystemtothird-partycasemanagementsystemsasneeded.

Compliance Analytics• Followsaprovencomplianceanalyticsmethodologythatusespredictivemodelstoscorethelikelihoodthatanalertwillcontributetoaproductiveinvestigation.

• Reducestheneedtotuneindividualscenarios,sincethroughputisgovernedbyanalyticmodels.• Deploysgeneralizedmodelsinitially,andthenre-scoresmodelsagainstyourorganization’sdataafterthesystemisupandrunning.

Integrated Case Management• IncludesaWeb-baseduserinterfacethatsupportsthemanagement,investigationandreport-ingneedsofanalystsandinvestigators.

• Documentsandretainsallactionsperformedonalertsandcasesforauditandregulatoryreview.

• Automaticallyidentifiesalertsthatmayberelatedtoexistingcases.

Compliance Analytics

SAS and several leading financial institutions jointly developed and refined a compliance analytics methodology based on years of analyzing case man-agement outcomes. SAS Anti-Money Laundering uses this methodology to significantly reduce the number of low-quality alerts in the work queue so that your scarce human resources can focus on conducting more productive, success-ful investigations and SAR filings.

When alerts are generated, the system automatically filters them through a predictive modeling process that ex-amines alert information together with profile signatures to predict with greater accuracy whether or not an alert will contribute to a productive investigation. To date, SAS customers have used post-alert analysis to improve hit rates by 20 percent to 30 percent or even higher.

The solution’s flexibility enables you to deploy generalized models initially, with the intent of re-scoring against your organization’s data after the system is up and running.

Risk assessment details help surface information to accurately assess the risk the cus-tomer poses to the institution.

Alert details provide contextual information about the alert and tell you how and why the alert was generated.

Key Features (continued) Regulatory Report Generation• Enableseasierreview,submissionandmanagementofmultipletypesofregulatoryreports(SARs,STRs,CTRs)viaauser-friendly,centralregulatoryreportingconsole.

• Enableseasyeditingorcorrectingofpriorregulatoryfilings.• Supportsnewe-filingprocesses,includingerrorhandling.• EnsuresconsistentprocessesforSAR,STRandCTRfiling.• Supportsmultipleformsandlanguagestoaccommodatevaryingjurisdictionalrequirements.• Capturesresponsecodes,errorcodes,etc.,fromgovernmentfinancialintelligenceunits.• SupportsnewFinCENforms.• CentrallymanagesSARaccessprivilegestoensureconfidentiality.

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SAS® Anti-Money Laundering System Requirements

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