SAS Anti-Money Laundering Solution · Target marketing Segmentation & Profiling Human Resource Mgt...
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Transcript of SAS Anti-Money Laundering Solution · Target marketing Segmentation & Profiling Human Resource Mgt...
Copyright © 2004 SAS Institute Inc. All rights reserved.
SAS® Anti-Money Laundering SolutionSascha Schubert
SAS EMEA
Copyright © 2004, SAS Institute Inc. All rights reserved. 2
How can a Bank become AML compliant?
The Issue• Poorly drafted legislation, open to interpretation• Lack of strong leadership from regulator• AML is ‘all cost, no benefit’
The Temptation• Minimalistic compliance for as long as possible
The Risks• Reputation, reputation, reputation• Increased scrutiny• Personal liability• Financial Risk
Copyright © 2004, SAS Institute Inc. All rights reserved. 3
Benefits of Technology for AML
Technology is only part of the picture
Financial organizations need to have complete strategy in place to comply with AML regulations• Risk-based approach to AML • Develop and document strategy• Train staff to implement strategy• Use technology to support the implementation of the
strategy
Copyright © 2004, SAS Institute Inc. All rights reserved. 4
Benefits of Technology for AML
Objective of AML technology:• help financial organizations to comply with local AML
regulations• not to detect money laundering – but to know their
customers better to be able to detect unusual transactions / activity
• Risk-ranking unusual activity to help focus on highest risk
• Minimize false alarms for more efficient investigation• Support investigation of these unusual transactions • Support reporting of these unusual transactions to
regulators
Copyright © 2004, SAS Institute Inc. All rights reserved. 5
Components of the SAS AML Solution
Discovery
Copyright © 2004, SAS Institute Inc. All rights reserved. 6
Component ArchitectureData
ManagementAlert Engine Investigation
Transactions
DiscoveryAdministration
Profiles
Data Store
0102030405060708090
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Regulatory reports
Feedback
Newscenarios
Copyright © 2004, SAS Institute Inc. All rights reserved. 7
Data Management
Open Metadata-Driven Architecture
Robust Data Access Engines
Comprehensive Transformation Suite, Data Quality
Framework for executing production scenarios and creating alarms
Framework for scenario management
Logical & Physical Data Models
Customer &Account
Transactions
Product
Copyright © 2004, SAS Institute Inc. All rights reserved. 8
Data Management – Data ModelsKnowledge
CenterAML CoreOperationalData
Transactional data
Customer Information
Watch Lists
Dimensional Model with Transaction History
and Customer Profiles
Alerts History, Audit Trail
and Metadata
Copyright © 2004, SAS Institute Inc. All rights reserved. 9
Alert Engine
Administration
Data Management
Transactions
Investigation
Discovery
Profiles
Data Store
0102030405060708090
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Regulatory reports
Feedback
Component Architecture
Newscenarios
Copyright © 2004, SAS Institute Inc. All rights reserved. 10
Alert Engine - ScenariosScenario Library of 20 Business Scenarios
3 categories• Status scenarios
− Independent on transactions, rely on customer information such as address changes
• Transaction scenarios− Monitoring transactions for a subject in date order− no historical information needed
• Behavioral Scenarios− Consider historical behavior of subject over time
SAS hosts consortium with customers to share scenarios
Copyright © 2004, SAS Institute Inc. All rights reserved. 11
Ranking, Suppression and RoutingRanking• Advanced Analytics
− Bayesian Classifier− Individual Profiling
Suppression• Suppress based on scenario for a specified duration• Suppress based on entity (e.g. account) by scenario for a
specified duration (driven by Investigative UI)
Initial Routing• Route to specific investigators• Route to groups
Copyright © 2004, SAS Institute Inc. All rights reserved. 12
Data Management
Alert Engine Investigation
Administration
Transactions
Discovery
Profiles
Data Store
0102030405060708090
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Regulatory
Reports
Feedback
Component Architecture
Newscenarios
Copyright © 2004, SAS Institute Inc. All rights reserved. 13
Investigation Component
Web Based Reporting
Security• User and Group Level
Reports based on defined rules
Manage flow of Information
Capture Pertinent Information
Copyright © 2004, SAS Institute Inc. All rights reserved. 16
Investigation Workflow
Global Suppress?
Do not display
Y
Report & Investigate
FalsePositive?
Y
Local Suppress?
Y
N
Report(SAR)
N
InitialAlert
NAlert
System
AML Knowledge Centre
Log Activity
Local Suppress
list
GlobalSuppress
List
Copyright © 2004, SAS Institute Inc. All rights reserved. 19
Discovery
Facilitate Basic and in-depth analysis
Ad-hoc query “I just read about a Money Laundering Scheme in WSJ and I want to see if any of our accounts is doing similar activities.”
Reduce False Positives “History has shown us that Accounts with these characteristics are clean, therefore, I don’t want to see them on an alert.”
Data Visualization
Copyright © 2004, SAS Institute Inc. All rights reserved. 20
Component ArchitectureData
ManagementAlert Engine Investigation
Administration
Transactions
Discovery
Profiles
Data Store
0102030405060708090
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
Feedback
Newscenarios
Regulatory
Reports
Copyright © 2004, SAS Institute Inc. All rights reserved. 21
Discovery
Facilitate Basic and in-depth analysis
Ad-hoc query “I just read about a Money Laundering Scheme in WSJ and I want to see if any of our accounts is doing similar activities.”
Reduce False Positives “History has shown us that Accounts with these characteristics are clean, therefore, I don’t want to see them on an alert.”
Data Visualization
Analysis of Textual Data
Copyright © 2004, SAS Institute Inc. All rights reserved. 22
Administration
Data Management: ETL, metadata, storage
Security and Users: group hierarchy
Alerts: tuning, adding, weighting rules
Workflow: routing of alerts
Copyright © 2004, SAS Institute Inc. All rights reserved. 23
Scenario Administration
Secure Infrastructure
Fine-tune subsystems by adapting rule parameters
System efficiency
Meet auditing requirements
Copyright © 2004, SAS Institute Inc. All rights reserved. 25
SAS Key DifferentiatorsEnd-to-end solution to cover entire Intelligence process (IVC)
Capabilities to build comprehensive AML Warehouse • More than just transaction monitoring –need to link the
characteristics of the single transaction with other data (customer information, history, external information)
Advanced analytics• Uncover hidden relationships between subsequent transactions,
different accounts, different account holders• Monitor the performance of the system in terms of compliance and
accuracy
Information Dissemination• Use web services to make information available where and when
needed
Integration into larger Banking Intelligence Solution
Copyright © 2004, SAS Institute Inc. All rights reserved. 26
Integrated Data Model
Corporate Performance Management
Market RiskCredit Risk
Operational Risk•Intrusion Detection
“Risk Mgt for Banking”(Basel II)
Anti-Money Laundering
Fraud • Kiting•Credit Card•Loans
Channel Mgt
ATM Forecasting/ Optimization
Branch/Web/ Call CenterMgt
Offer Optimization
Web Analysis
IT Mgt
Product/Channel analysis
Customer ProfitabilityLife time value
Credit Scoring Wealth Mgt
Target marketingSegmentation &
Profiling
Human Resource Mgt
Broker Surveillance
Compliance Reporting Portal
Cross-sell/up-sell
Campaign Mgt
Customer AcquisitionCustomer Retention
Asset/Liability Mgt.
OperationalCustomerRisk
•Credit Scoring
SAS Financial Service Intelligence
Financial Mgt
Copyright © 2004, SAS Institute Inc. All rights reserved. 27
SAS AML Customers
Financial organizations in:
US
Canada
Europe
Middle East
Copyright © 2004, SAS Institute Inc. All rights reserved. 28
SAS AML Customers - References
Bank of America, US
Morgan Stanley
Branch Banking & Trust, US
Unity Trust Bank, UK
Copyright © 2004, SAS Institute Inc. All rights reserved. 29
SAS AML Customers – BB&T
"BB&T's reputation is built on … doing business with unwavering integrity. We take pride in being rated as one of the country's safest…. It is clear SAS supports that sentiment with their rock-solid reputation and financial stability, as well as a commitment to its customers -demonstrated through its high investment in research and development."
“Built on SAS' leading analytic and data management technology, SAS delivers an AML solution that is top of the line. After evaluating other vendor offerings, we chose SAS because of the solution's functionality, compatibility and the ability to customize the technical architecture."
Phil Koonce, Manager of operational risk at BB&T