AI technology to help OCBC profile customers and detect illegal transactions

Maria Nikolova

The Singaporean bank has teamed up with fintech companies BlackSwan Technologies and Silent Eight to implement an AI solution in its compliance operations.

Oversea-Chinese Banking Corp. Limited (SGX:O39), or OCBC, is the latest company to join the growing list of businesses adopting artificial intelligence (AI) solutions in order to optimize certain back-office operations.

According to a report by the Straits Times, the bank has teamed up with fintech companies BlackSwan Technologies and Silent Eight to develop and use the new solution.

The AI solution will be used to detect suspected illegal financing, by searching for information on individual profiles, and mapping suspicious transactions to see how they may be linked.

Alex Ng, OCBC’s group transaction surveillance head, commented: “We felt that this ‘back office process’ of transaction monitoring could definitely use an innovative solution to help automate things and make our investigative research more timely and effective.”

Typically, the research after a signal for a suspicious transaction takes at least an hour for a team of human compliance analysts. Thanks to Silent Eight, digital scanning puts together information in a minute, and AI helps filter out irrelevant information such as people with identical names. Afterwards, BlackSwan Technologies takes over to analyze the suspicious transactions with AI. This involves mapping the transactions to a network of related transactions to identify possible connections with other individuals or companies which may be atypical or previously unknown.

Using AI solutions to combat fraud is proving popular in the financial services industry. In February this year, Japan Exchange Regulation (JPX-R) and Tokyo Stock Exchange, Inc. (TSE) said they were working on applying AI to market surveillance operations by using technologies developed by NEC Corp (TYO:6701) and Hitachi, Ltd. (TYO:6501). Tests show that the AI solutions are highly accurate in detecting the possibility of unfair trading.

Among the advantages of such systems over conventional surveillance systems is that AI is able to learn on its own and determine the possibility of unfair trading. “H”, for instance, is known for its ability to learn from vast amounts of data and make judgments on its own – this way, it removes the necessity for people to set up hypotheses in advance.

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