AI and Blockchain for Anti-Money Laundering (AML) Compliance

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If there is something that has been affecting the financial world negatively and given rise to massive corruption, I will say it is the money laundering issue. Even though several structures, systems and policy have been out in place to help tackle the cases of money laundering, but it looks like it is not solving the issue, instead it looks like it is getting worse every blessed day. The case of illicit funds and generally money laundering cases in the financial system seems to be getting so much as the day goes by.

But recently, we have a new solution that have promised to offer a solution in that aspect and that is the solution of Artificial intelligence and the Blockchain technology. Both of them have their own strengths and so, combining their strengths together will go a long way to settle the money laundering issue and that helps to give birth to what is called the Anti Money Laundering Compliance that we have in the financial world.

Let me start by establishing the role that artificial intelligence plays when it comes to AML compliance. In recent years, AI have come with strong force to offer a lot of positivity to our world and that also includes the financial world. With AI, it has helped to enhance pattern recognition and anomaly detection which can help to filter out any transactions that seems illegal. Not only that, with the anomaly detection, it helps to help for investigation regarding illicit funds to be carried out effectively.

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That is not all, as many of us know, one of the be major strength of Artificial intelligence is the fact that it can help to automate things. What do I mean by that? The fact that tasks and processes can be carried out without the aid of Human beings also ho a long way because with it, it can help to point out any suspicious activity regarding funds. Not only that, it will reduce the issue of human error when it comes to finances. Then lastly, AI can help to properly analyse datas so as to determine any risk that is not worth taking when it comes to finances.

The same way AI offer a lot of benefits for AML compliance, that is the same way Blockchain plays it's role and which I will briefly like to talk about. The fact that Blockchain technology is actually Immutable in nature helps to make sure that every transactions recorded cannot be altered or changed again. This goes a long way to help sustain transactions that is been carried out regarding money. This will help to achieve a very transparent transactions carried out.

Not only that, with Blockchain technology, it helps to reduce the rate of criminals making use of spamming accounts to carries out their illicit and fraudulent activities because the Blockchain technology helps to offer something called the kyc which people called the know your customer verification. This can also help to protect the customer information and data from been used for any illicit activities also as it is very important also.

Of course combining both of them will go a long way to help achieve massive result so as to give this AML framework that is not there before. With the Blockchain technology, we can have a secured, transparent and Immutable nature and so with AI, we have the processes to be automayed. With both of them being incorporated in the financial system, it will go a long way to deal with any financial issues or fraudulent activities that are ongoing.

Of course there are also a lot of challenges involved. Challenges like the Data privacy, the aspect of regulatory complexity and many more. All these challenges needs to be looked into if not, it will continue to limit the role both AI and Blockchain technology should play in the financial system. But I am so optimistic that the future will certainly be great. There is also the challenges like the technical integration and many more. In fact, one of the major challenges that I have come to discover is the aspect of regulatory complexity.

As I conclude, I am really optimistic about the future and I am so sure that both AI and Blockchain technology will still advance and get better. Of course those challenges that I mentioned earlier will be settled. I am very optimistic that the future when it comes to the financial system. All these issues of money laundering that we are facing right now will definitely be overcome in due time. I am so sure of that certainly.