Harnessing Blockchain technology and Artificial Intelligence to
AML CENTRAL detect and prevent money laundering
High efficiency output. Reduced false positives
Secure and private inter-institution collaboration
Regulatory oversight. Instant visibility
2 The Challenge: Money laundering continues to be a global challenge and today’s
archaic AML solutions are unprepared for the emerging world of digital financial
Existing transaction monitoring systems, are unable to keep pace with growing data sources, volume and complexity of transactions
Growing wave of new digital financial services
Silo’d programs; very limited inter-institution collaboration
Too many false positives; very scant automation to deal with it
Scattered data sets; absence of integrated intelligent analysis
Despite spending billions of dollars on AML solutions, financial institutions and regulators continue to face an uphill battle in the fight against money laundering
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3 The Solution: Blockchain technology when complemented with AI offers a modern
approach to the monitoring and identification of suspicious financial transactions
The first electronic value transfer protocol Key features of Blockchain technology
Blockchain
Open source Distributed Secure Decentralized Cryptographically Immutable Consensus
value transfer P2P network math-based Secure driven
protocol system
How a blockchain works
The transaction is
The block that can be
represented online
added to the chain, which
A wants to send as a `block’ The money moves
The block is broadcast to Those in the network approve provides an indelible and
money to B every party in the network the transaction is valid transparent record of from A to B
transactions
1 2 3 4 5 6
The Blockchain, a cryptographic ledger comprising of a digital log of transactions shared across a public or private network, along with data science and machine learning can
effectively address pitfalls of existing AML systems
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4 The Platform: AML Central leverages emerging Blockchain technology along
with Artificial Intelligence to pinpoint, triage and prevent suspicious transactions
Central Bank
2 Regulator & N/W Mgmt.
Monitor, Analyze
1 3
AML App & Blockchain AML App & Blockchain
Node Node
Input subset of Alert, Record
transactions
Private Permissioned
Bank A Bank B
Blockchain Network
• Alert stakeholders
Input data. AML App + AML App &
• Flag and stop
Invoke smart
contract
Blockchain
Node
Network Directory &
AMLSmart Contracts
Blockchain
Node
! payments
• Record/Log Details
AI/ML Engine and
Analytics
Automated, quick and
Transaction/payments
effective
Customer profile data
Improved accuracy
Patterns AML App & Blockchain AML App & Blockchain Immutable logs and audit
Other details Node Node
trail
Bank / Fin. Exchange Bank / Clearing House
The platform gives regulators, auditors and other stakeholders an effective and powerful set of tools to monitor complex transactions, immutably record the audit trail of transaction
across the financial network, identify rogue patterns and strengthen proactive detection and prevention of money laundering.
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5 How it works: Financial institutions securely parse data through an AML
engine on the Blockchain and get alerted to potentially suspicious transactions
The distributed ledger system allows financial institutions to share leverage one another's data without compromising on security
or privacy, while the artificial intelligence provides for smart automation and high efficiency output
Global & Regional
Regulatory Bodies
Information & Advisory
Guidelines
Transfer Trxn.
Request Request Trxn. Transfer
External Data Active Pattern
Control lists Regulations Request Request
Sets Libraries
Customer Smart Contracts AI/ML Engine
Funds Validated Bank 2
Account Bank 1 Validated Funds Customer
Transfer Trxns.
Trxns. Transfer Account
Alerts Alerts
Blockchain
Networks
Financial
Actively Central Banks &
Institutions
Identified Regulators
Accounts
Investigative
Agencies Enquiry & Investigation
Enquiry & Investigation
Intermediary Networks
Funds Transfer Funds Transfer
The platform compliments existing systems and enables one institutional system to alert another of fraudulent transactions within their mutual network; thereby accentuating
common records and minimising false positives
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6 The Building Blocks: Private permissioned Blockchain technology and
machine learning for automation and efficiency along with security and privacy
Blockchain N/W
Management
Ledger
Ledger
Node Node
Define contracts.
Ledger of Records
Monitor transaction
Regulators
Central Bank
Ledger
Ledger
Data sets
Other auditors Node Node
Machine learning
Input transaction.
Invoke contracts
Ledger
Ledger
Banks
Other Financial
Node Node
Institutions
Key Features * 4. Cryptographically secure – encryption/decryption for
1. Private Permissioned Blockchain network visibility to only entities linked to a transaction and
2. Distinct roles for banks, regulators, exchanges authorized auditors/regulators
and other users 5. Auditing at multiple levels.
3. Distributed system for confidentiality, resiliency, 6. Logs immutably recorded, providing a single version of
and scalability the truth with a complete audit trail of (suspicious)
transaction across the system
* Adapted. Based on the Hyperledger Fabric Blockchain
Being cryptographically secure will ensure credibility while the immutability feature of Blockchains will maintain tamper-proof records for current assessment as well as future
analysis
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7 The Status: We’ve crafted the solution, deployed a demo & are working with
partners to empower regulators, banks and other stakeholders globally
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8 The Result: A next-gen AML solution ready for today’s complex financial
environment and tomorrow’s evolving regulatory needs
Effective Intelligent and Distributed for Immutable &
monitoring of Integrated scalability and Tamper-Proof
suspicious allowing one resilience logs
transactions institution’s to keep pace with stored securely on
reducing the large system to securely the growing data the Blockchain
number of false and privately alert sources, volume for instant
positives with another of and complexity of assessment and
minimum friction suspicious activity transactions future analysis
Additionally, the system will also provide an ultra-secure platform for communication and information sharing among the participating organizations
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9 Learn how you can harness Blockchain technology along with Artificial intelligence
to detect and prevent money laundering as we leap into an era of digital finance
Drop us a line or reach us via any of the channels below:
www.blockchainworx.com
[email protected]
Reach Us +91 9320930671
+65 96536243
@blockchainworx
www.BlockchainWorx.com
