26.03.2024
Inspector AI tackles money laundering
With the help of artificial intelligence, Peruvian authorities can identify and pursue cases of money laundering better.
Casinos, jewellery businesses, banks: places where large amounts of money circulate can become hubs for illicit financial transactions, for example for laundering money from drug cultivation. In Peru, suspicious cases are reported to the Financial Intelligence Unit (FIU). These are on the rise and currently top 23,000 annually. For the FIU, this poses major challenges. Together with the National University of Engineering in Lima, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH has developed software to help identify priorities. The tool uses artificial intelligence (AI) to evaluate the suspicious transaction reports.
Whereas investigators previously assessed the data manually, AI now structures the information digitally. This shortens the processing time per report and helps the unit to focus on high-risk cases. In the words of an FIU manager: ‘Thanks to the tool, our staff can concentrate on analysis and are less tied up with individual reports. We’re combating money laundering and the funding of terrorism more effectively.’
Greater efficiency thanks to text pattern recognition
The AI-supported software automatically filters data such as names, addresses and payment types from the suspicious transaction reports. It also reads free-text fields that previously couldn’t be logged and runs filters to pinpoint high-risk cases. This means that concealed money laundering – for example in connection with drug trafficking, illegal resource extraction or corruption – can be identified faster and charges brought more quickly.
To enable the investigators to use the software in their day-to-day work, GIZ was commissioned by the German Development Ministry (BMZ) to train staff and advise them on complying with international standards. And it’s working: since the AI software was introduced, the number of suspicious transactions reported to the public prosecutor for legal action has more than doubled. In this way, the Peruvian state is combating illicit financial flows that deprive it of tax revenues.
