Safe Banking Systems and Centrifuge Systems partner to combat money laundering, terrorism and fraud

Safe Banking Systems Software, LLC (SBS), a provider of anti-money laundering and compliance solutions, and Centrifuge Systems, Inc., of McLean, VA, a provider of advanced link analysis software, have joined forces to provide government agencies, banks, financial services firms and other organizations with the ability to combat financial crime by detecting entities in corporate databases that pose risk.

Centrifuge provides free-form data exploration via link analysis techniques, with connections rendered as interactive visualizations, including charts, maps, timelines and geospatial. Users can connect to and integrate data from multiple sources, find groupings and patterns and see non-obvious relationships and anomalies in large data sets at record level detail.

In addition to fraud analysis, applications include intelligence analysis by government agencies and network security analysis by the private sector.

SBS offers specialized technology solutions for anti-money laundering, fraud and risk management. The company’s entity-resolution software employs complex, ever-evolving algorithms that isolate the anomalies in large databases of high-risk entities and alerts clients to dangerous elements identified in their customer base. In addition to its SAFE Advanced Solutions, SBS provides a Forensic Analysis Service for institutions requiring immediate identification of their highest-risk entities.

SBS will use Centrifuge’s link analysis technology with its SAFE Advanced Solutions and Forensic Analysis Services to identify sanctioned, politically exposed and other high-risk entities within client databases, thereby enabling organizations to take steps to investigate and manage risk more quickly.

“Terrorists, financial fraudsters and drug dealers use complex schemes to camouflage their identity, often to hide substantial sums of money in financial and non-financial institutions worldwide,” explains Mark Schiffer, Vice President Research and Chief Scientist with SBS. “Laws like the Patriot Act require financial institutions to know their customers and conduct enhanced due diligence or face massive fines. This is done by scanning customer files against global sanctions lists and large databases containing profiles of politically exposed persons and other high-risk entities. However, the traditional approach to watch-list filtering is costly, time-consuming and often incomplete since the threats are always changing. Because consequences can be severe if financial institutions miss finding any of these threats in their customer databases, an evolving, scalable, pervasive solution is required.”

“The Centrifuge visualizations and analytics enrich our proofs of concept and distinguish our forensic analysis services from the competition,” continues Schiffer. “While the human mind is the best pattern recognizer, it is neither scalable nor ‘always on.’ With Centrifuge, SBS is able to find patterns undetected by others, develop rules that are scalable and persistent and solve cases more quickly. Because SBS delivers more accurate and complete results, organizations can more effectively identify real money laundering and fraud schemes that would impact the organization if gone undetected, and take steps to substantially mitigate risk.”

“Regulatory fines and damages can be measured in the hundreds of millions of dollars for institutions not in compliance,” comments Guljit Khurana, President and CEO of Centrifuge Systems. “Centrifuge empowers SBS to evolve its knowledgebase in response to changing threats by improving its ability to perform deeper analyses while working at the speed of the human brain. With Centrifuge, SBS can visualize data in the form of relationship graphs to identify hidden connections between people, accounts, transactions and other events. Because SBS is able to perform unconstrained analyses faster, it can uncover suspicious activity invisible to others. Typically, this activity is missed by other analysis tools.”

Data visualization deciphers Bulgarian fraud ring

“Elaborate fraud schemes like the Bulgarian Money Mule ring, for example, are hard to detect because they are designed to fly below the radar of most merchant processors and credit card companies,” explains Schiffer. “This network of fraudsters set up dummy companies in the US; opened bank accounts to receive card payments; and set up toll-free numbers, web sites and virtual addresses – all of which were used to deceive the card processors. They then used credit card information obtained from identity theft victims to process more than a million one-time charges of $10 or less through large merchant processors. Because the credit card charges were so small, most consumers did not notice them or seek charge backs. With Centrifuge, we were able to identify hidden linkages in the data, ring leaders, waves of fraud activity and a money trail back to Cyprus, Bulgaria and other countries. Advanced link analysis and the ability to integrate data allowed us to connect the dots and draw a picture of the fraud ring.”

“SBS continues to build on its core competencies and is committed to delivering value-added solutions and advanced technology with the highest level of service,” concludes Schiffer. “Centrifuge’s interactive analytics and visualization technologies will further enhance our ability to help institutions meet changing regulatory requirements and streamline processes while saving time and money.”

Industry appearances and presentations
Centrifuge Systems will present a session on July 27 at the 21st Annual Association of Fraud Examiners Conference to be held July 25-27 at the Gaylord National Resort & Convention Center in National Harbor, MD. The company is also releasing a white paper entitled “Data Visualization Techniques for Fraud Analysis” at the show.