Late January’s hot deal category? Artificial intelligence for anti-money laundering, as three fintechs specializing in fraud prevention announce funding rounds.
While they all have slightly different approaches, they share the goal of using machine learning to flag anomalies that could indicate suspicious behavior or emerging threats, reduce false positives, and cut down on manual work.
Ultimately, they also lower the risk of penalties and fines that have become all too common: ComplyAdvantage’s recent Financial Crime survey found that that a stunning 79% of respondents said that their firms choose to make AML violations and incur related fines as a cost of doing business. That’s up from 61% in 2020.
The startups boast backers from the likes of Wise, Stripe, and Square, as well as clients like Visa. In the same vein, Insight Partners’ portfolio company Featurespace recently won government funding to use artificial intelligence to catch money laundering while protecting data privacy, while Standard Chartered is using tools from Chekk for real-time risk assessment and anti-money laundering.