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money laundering uae

Data Analytics – A new weapon to fight money laundering


Money laundering in UAE is a pestilential issue that has been haunting banks and financial institutions for decades. Government and businesses are at the risk of tax evasions and financial crimes all the time.

It needs constant monitoring with utmost scrutiny. Even a slight error or mismanagement can put you in a legal quagmire.

Numbers don’t lie

Money laundering in UAE

Over the years, we have witnessed a paradigm shift from traditional methods to a technology-driven approach to deal with financial crimes.

With the rise of technology, data analytics has gained enormous importance. Hence, there has been an increased focus on AI, machine learning, and big data to detect and prevent such criminal activities.

Money laundering in the UAE is a perpetual threat lurking over your organization. Today, compliance requirements are more complicated with increased data levels.

All these factors collectively have made the fight against financial crime way more difficult.  Therefore, it is high time to upgrade our defense with cutting-edge technology.

Banks and Financial institutions are adopting new technologies and implement them in their operations against money laundering. It also helps them safeguard themselves from market misconduct, terrorist fundings, bribery, and corruption.

Compliance requirements are dynamic and updated quite frequently. It makes it even more tricky for you to keep up with them. Technology brings agility, accuracy, efficiency, and more importantly better prevention against financial crimes.


How Data analytics and AI help combat money laundering in the UAE

Human intervention is not enough today to tackle money laundering. Therefore, You need to incorporate automated processes in your business to deal with it.

Financial institutions are laden with regulations and struggling to mitigate financial risks internally and externally.  Fortunately, technology has come to their rescue.

You must adopt an Intelligence-led data-driven approach to fight financial crimes. Advanced analytics and cognitive techniques enable you to identify criminal behavior and shortcomings in the existing investigative process.

Following are the useful AML compliance programs powered by Big data and Analytics. You can use them in a variety of ways in your organization.

1. Customer due diligence (CDD) and Know your customers (KYC)

Big data and analytics process customer information leveraging external information sources. It helps you comply with domestic and international regulations such as EU, FATF, BSA etc. through sanction scanner.

It also assists companies with updated AML data. Additionally, Data analytics and AI bring in innovative ways to resolve SMR surrounding rates, KYC due diligence, and screening alert management issues.

2. Customer Onboarding & Monitoring Processes

Manual on-boarding and monitoring process is time consuming and less accurate. Financial firms have to ensure that it is KYC compliant. With increasingly complex requirements, it is practically impossible to do so without advanced technology. Data analytics enables companies to meet evolving compliance demands.

3. Transaction Monitoring System (TMS)

Transaction monitoring is at the heart of any AML process. It is a tedious task and needs sound accuracy. It takes time to figure out discrepancies. With technology, you can examine every transaction with Japanese precision leaving no scope of error.

Big data gives you a clearer and more holistic picture of financial activities to detect anomalies way more efficiently. You get a better understanding of the trail of illicit gains from various sources such as human trafficking, drug supply, fraud, corruption, and terrorist fundings.

Data analytics and AI can identify patterns of transactions and anomalies faster. It enables compliance professionals to detect the loopholes and fix them. It cracks down suspicious transactions and safeguards you from illicit financial activities. 

4. Individual customer profile monitoring

Profile monitoring is time consuming and crucial to eliminate false positives but Big data and analytics creates behavior models based on individual customer profiles. Moreover, It monitors behavior patterns and take any indication of deviation into accounts that can lead towards potential money laundering.

5. A strong defense mechanism

Data analytics essentially empowers your anti-money laundering process. It just does not help you track down and remove any illegal transaction but helps you identify certain patterns.

Based on that, you can map out a strong defense policy in place for your financial operations. It can also assess a string of transactions and establish a solid pattern to trace any illegal financial activities.

Tackling financial crimes with technology is not just faster but cheaper too. It also allows firms to take a smart and data-driven approach.

The other major advantage of data analytics is that it establishes the link among individuals, entities, and the supply chain. Furthermore, it tracks down everything involved in the money laundering process. It basically does the root cause analysis of what we humans often fail to achieve.

6. Data Insights

Technology does not just monitor every transaction with accuracy but gives you valuable insights. Transactions generate plenty of data every day. You can process it using data analytics and turn it into actionable insights.

You can implement these findings in your financial operations to achieve the highest level of compliance. Hence, technology-enabled solutions are not just preventive but also predictive too. It just doesn’t help detect and resolve financial crimes but develop an efficient anti-money laundering policy in the UAE to avoid such instances in the future.


The advanced Big data and Analytics techniques to tackle money laundering in the UAE

Companies are already moving away from the run-of-the-mill methods and quickly embracing AI and data analytics for better compliance. Following are some of the key advanced techniques that help you counter Anti-money Laundering.

We truly believe that such AML techniques can be implemented in key business areas to protect your company from money launderers.

Text Analytics

It extracts data from text files through an automated process. It also provides you a valuable data that can be used for transaction monitoring.

Web analytics and Web-crawling

Such tools scan the web and review shipment and customer details thoroughly. Once done, it can compare the outcomes against corresponding documentation.

Unit price analysis

It facilitates you with the statistic-driven approach utilizing public data and algorithms. It helps you detect whether unit prices rise or fall according to the global and regional standards.

Unit weight analysis

It is a great technique that informs you where money launders are making their next move. It also tells you about any attempt made of transferring value by overstating or understating the quantity of good in relation to payments.

Network (relationship) analysis of trade partners and ports

There are enterprise analytics tools to detect hidden data links between trade partners and ports, and between other participants in the trade life cycle. You can also identify shell companies or outlier activities.

International trade and country profiling analysis

You can analyze publicly available data to sort out certain profiles. It helps you identify what types of goods are exported and imported from specific countries that may involve TBML (trade-based money laundering) activities. It gives you with trigger alerts and tells you when to press the buttons to prevent any financial misconduct.


The road ahead

The primary purpose of technology is empowerment through efficiency. Artificial intelligence (AI), Machine Learning, Big Data, and Analytics indeed accelerate and automate critical AML processes with preventive interventions.

Compliance is essential and ever-changing. Moreover, It is becoming more and more demanding. Therefore, we have to rely on data analytics to meet the evolving needs of compliance. Technology not only does helps with current compliance but keeps up with future regulations.

Looking at how things are rapidly moving, financial compliance can never be obtained without data analytics and automation. Hence, compliance officers will have to automate their daily tasks and depend on insights.

Compliance teams must analyze the data outcome and be able to come up with a solid framework to combat money laundering in the UAE. Besides, they need to keep themselves updated with regulations and ensure their firm’s policies are in line with them.

They must leverage the data and technology to flag suspicious activities for better compliance. Compliance officers must be proactive rather than reactive to identify risks and opportunities. They also have to stay on top of things with the help of technology to prevent any illegal transaction, tax evasion, or financial misconduct.

Data Analytics is already playing a pivotal role in the fight against financial crimes. Implementing state-of-the-art technology is key to a successful AML program. What matters is how you make use of it. That’s the bottom line.


Please get in touch with us at enquiries@nrdoshi.ae or, log on to our website for more details.


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