#1657967: Money Mule Defence: Practical Applications and the Role of Technology
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The impact of money mules cannot be overestimated. Money mule networks launder as much as $1.6 trillion a year globally. Money mules substantially contribute to money laundering crimes, removing colossal sums of illicit funds from the legitimate economy, stripping governments of tax revenue and thwarting economic growth by diverting capital away from productive investments, ultimately shrinking a country's GDP. The National Crime Agency (NCA) estimates that over £10 billion is laundered via money mule activity in the UK annually. Alongside this, in 2022, UK banks identified over 39,000 accounts that demonstrated behaviour that was indicative of money muling. It is evident that a cross-sector response is required to mitigate money mule activity and protect victims against financial exploitation because fraud teams cannot be stretched further than they already are. At the moment, banks monitor accounts for suspicious activity and use digital identity verification to conduct behavioural analysis, and in turn, search for behavioural anomalies in mouse activity, typing patterns, navigation preferences and platform choice. Financial institutions could also prioritise investing in mule risk education, build a repository of intelligence, and cooperate with law enforcement to prevent these threats. However, more can always be done. With machine learning, continuous pattern analysis, rule modelling and optimisation can connect insights that have been gathered from a diverse network to predict the likelihood of an account being used for mule activity. This also ensures that banks are taking advantage of the data-driven solutions available to them. Innovative technology companies can now develop, train and test machine learning mule models to identity fraud threats and protecting customers. This increased focus on inbound payment monitoring is also to the bank’s benefit. With the UK’s new reimbursement rules in effect from October 2024, payment service providers are required to reimburse eligible victims of fraud. Banks will need to enhance their fraud prevention systems with technology to minimise the need to reimburse customers for fraudulent transactions. Better detection and proactive measures can significantly reduce financial losses caused by fraud, ultimately protecting both the bank and the customer. |
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| More info: | https://www.finextra.com/event-info/545/money-mule-defence-practical-applications-and-the-role-of-technology?utm_medium=dailynewsletter&utm_source=2024-12-20&member=51631 |
| Date added | Dec. 20, 2024, 1:46 p.m. |
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| Source | Finextra |
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