Full version Anti-Money Laundering Mantas Solutions

Anti-Money Laundering Mantas Solutions

This print version free essay Anti-Money Laundering Mantas Solutions.

Category: Technology

Autor: reviewessays 01 January 2011

Words: 7330 | Pages: 30

Getting To Know Mantas

The Mantas Corporation, based in Virginia, along with offices in New York, the United Kingdom, and Singapore, has created powerful business intelligence solutions that help other companies determine risk, make informed decisions, improve relationships and grow their business. The people of Mantas are financial service professionals who understand the different aspects of business from compliance regulations and data distribution. As an overview, Mantas began as a business unit focusing on meeting the demands of an ever-changing global financial services industry.

“In the mid-1990s, the Mantas team began work as a business unit of SRA International, Inc. Focusing from the start on meeting the needs of the global financial services industry the first Mantas products addressed trading compliance and best execution for the National Association of Securities Dealers(NASD) and Merrill Lynch. Today, both systems remain in operation with the NASD Advanced Detection System monitoring every trade that goes through the NASDAQ and Merrill Lynch’s BEAMS helping that firm lead the industry in Best Execution evaluation.

Recognizing the value this technology could provide, SRA International in partnership with Safeguard Scientifics, Inc., a developer and operator of emerging infrastructure technology companies, spun-off Mantas, Inc., in May 2001.

In October 2003, Safeguard Scientifics, Inc. (NYSE: SFE) made an additional investment in Mantas. This investment was directed towards continued global expansion and product advancement. ”

Today, Mantas provides more than five thousand professionals in financial institutions worldwide with analytic applications that concentrate on risk management, performance management, fraud detection and operational analysis needs to improve business. The company primarily focuses on enterprise-wide anti-money laundering, surveillance and trading compliance software. Some of the companies that Mantas provides its services to include: ABN Amro, Barclays Capital, Charles Schwab, Citibank and Merrill Lynch. These companies receive solutions that address their risk management, performance management, fraud detection and operational analysis needs.

Mantas, Inc. is a global software company that has developed a behavior detection technology that allows businesses to identify undiscovered risk and opportunity. They recently were honored in 2003 from Waters Magazine, for their Behavior Detection Platform, receiving the "Best Compliance Solution" award. “The company has also been ranked as a leading compliance vendor in reports from TowerGroup, Celent Communications and Butler Group. ”

The Mantas software programs acts as a starting point to improve business applications. It provides reliable protection in different areas such as: changes in regulatory culture, loss prevention applications that can expose unseen risks and losses, revenue generation applications that identify opportunities for institutions to increase revenues, improving customer satisfaction and reducing cost of sale.

From their website the services that Mantas provides include:

Regulatory Compliance:

Mantas Anti-Money Laundering

Mantas Trading Compliance

Mantas Broker Compliance

Mantas Mutual Fund Compliance

Mantas Advance

Mantas Select

Loss Prevention:

Mantas Fraud Detection

Mantas Operational Risk Analysis

Revenue Generation:

Mantas Client Assurance

The behavior detection technology that Mantas provides to its different financial institutional clients is one of the industry’s most complete solutions for avoiding risk, surpassing regulatory requirements, and enhances client relationships. The software is able to analyze the different behaviors of the people within a corporation. It starts with the customer, moving onto the employees and then finally to the corresponding partners in every transaction that takes place. It is able to do this without time constraints, letting its customers see the different trends and patterns for the past, present, and future. Being able to do this allows people using Mantas to analyze and sort through different decisions with accuracy and confidence. Mantas allows its customers to fully understand their business increasing their ability to decide between which risks and opportunities they are willing to take. By making their product user friendly and the results easy to understand, Mantas has become one of the industry’s leaders for compliance regulations and analytical data distribution.

The amount of information that Mantas can handle is superb. For just one independent client they are able to process over one hundred billion fields of data on any given day. In addition to their user friendly benefits,

“Mantas Scenarios are already coded, tested, and ready to use, enabling customers to realize benefits much sooner than with other, more time-consuming alternatives. There is no learning stage, or fuzzy-adaptive-black box scheme to run. We code it in right from the start because we understand the business and the business user. Mantas gives financial institutions and communications service providers the ability to monitor and analyze customer, performance and transaction information across the entire organization for a complete and accurate picture of behaviors of interest. As a result, it's now possible to detect suspect behavior early enough to mitigate risk, report and prioritize findings without manual intervention, comply with changing regulations, increase revenue by improving operations, and identifying up-sell and cross-sell opportunities. ”

Using advanced knowledge and technology developed together with banking and brokerage experts, the services Mantas provides can collect and analyze transaction data, while then sorting through what is relevant and the information that is going to need a course of action. This information allows their clients to be able to confidently assess what different areas throughout the entire organization are in need of improvement. Whether it is detecting suspicious behavior as in the forms of money laundering, which this paper will further explore, or if it is analyzing the different trends in the market, Mantas is able to report and prioritize its finding without any manual intervention.

“The Mantas technology platform utilizes multi-strategy data mining algorithms that detect patterns. It is a Web-enabled, end-to-end solution that includes data preparation and transformation; data mining and pattern analysis; pattern detection and alert management; proven scalability; open architecture; and integration with OLAP and workflow tools.

For brokerage firms: Mantas provides products addressing best execution, equities trading compliance, SEC disclosure, and anti-money laundering and fraud.

For banks: Mantas offers products for anti-money laundering and fraud, including surveillance of wire transfers, checks and monetary instruments, and electronic/Internet transactions.

For exchanges: Mantas provides products addressing market regulation and integrity, fraud, and customer relationship management ”

The Problem

Money laundering is quite a large occurrence which happens with illegally earned money. Money which is received through illegal transactions such as illegal arms sales, trafficking of illegal narcotics, prostitution, illegal alien smuggling is sent through either legitimate businesses or banks to “clean” the money and not make it questionable in the eyes of the public, and therefore in the eyes of the United States government. Without the large amounts of “dirty” money which is later “cleaned” through laundering international organized crime would not be able to function. Even mentioned in a 1997 House Committee of International Relations meeting on the Threat of International Organized Crime and Terrorism, Louise Shelley stated:

“Transnational organized crime will proliferate in the next century because the crime groups are among the major beneficiaries of globalization. Benefiting from increased travel, trade, telecommunications networks and computer links, they are well positioned for growth. The IMF recently estimated that the proceeds of the drug trade now contribute 2% of the world's economy. If the money from tax evasion and other illicit activity is added, the total is several times larger. Organized crime groups in the next century will control an even larger share of the world's economy because the illicit share of the world's economy grows annually. Illegal businesses are highly profitable and remain untaxed. ”

Two percent of the world’s economy is “dirty” money and that is quite a lot, also factoring in that many places in the world are not financially in the best state that they could be. Some countries even profit from the illegal drugs produced in their country which are shipped out, used, and then the money which is gained through the sale of these illegal products is then laundered and funneled through many different mediums to make the money that was made seem legitimate. Also in that same speech as previously stated, she also claimed:

“International organized crime groups are the reverse of legitimate multi-national corporations. Most major multi-national corporations are based in the industrialized world and market to the developing world, whereas transnational organized crime groups are largely based in developing countries and market to the developed world. Extremely profitable, they are even harder to regulate than the multi-national corporation whose activities span countries, and their growth has been prolific. Furthermore, the incentives for control are not there. Many countries lack economic alternatives and crime groups become dominant economic and political forces. Off-shore banking centers thrive in such settings, drawing money steadily from countries with powerful crime groups and eager tax evaders. High level corruption also impedes action against these groups. Lack of harmonized legislation and the absence of mutual legal assistance treaties make it impossible for foreign powers to effectively act against the crime groups. ”

There are three stages of money laundering: placement, laundering and layering, and integration . Placement is the placing of the illegal funds in the financial system and can be done either directly or indirectly. Directly a person gives cash deposits or drops sealed bags off at the bank or financial institution. Indirectly the use of a front is used, basically a fake organization that sounds like a viable business. From there the actual laundering occurs. The main idea is to break a paper trail or an audit trail, which in essence could prohibit them from being found out. Criminals would use many different transactions, bank accounts, institutions, and jurisdictions. The criminals would use many different banks and even use banks in different countries out of the main country that they are having illegal practices in. The actual integration of the money cannot be related to its criminal origin and is even invested into legitimate and legal businesses and investments; this further launders the money because any profit made off of those investments is clean. Some more examples of money laundering situations are; misuse of a not for profit organization, informal money or value transfer systems, entry of illegal funds and layering of illegal funds into the securities sector. Setting up a company as a front is a well known way of money laundering and the use of false or stolen identities, or documents.

This increasing problem in the United States and the world pressured computer programmers and software companies to develop and produce for wide use a system that would monitor transactions and bring attention to any account or accounts that have questionable activity. An example of this is, large amounts of money being deposited at any one time, or difference in consistence of money being deposited. Money that goes from being deposited weekly, from $1,500 to all of a sudden tens of thousands or hundreds of thousands of dollars would set off an alert in the system.

Anti- Money Laundering systems have been used ever since the USA Patriot Act in 2001, banks and brokerage firms have to file any suspicious activities with the government, or must meet the harsh penalties . In most cases being a really large fine. Any bank or firm that does not comply can be fined anywhere in the upward amount of $1 million. The agencies that were monitored also included all lending firms and other financial institutions that deal with monetary transactions between multiple clients.

Such things that raise a red flag to the systems are a customer’s employment history not matching their investment, large sums of money being entered from this employee which is more then he or she has ever entered previously. Large numbers of individuals depositing into the same one account also brings attention to the account, and from there on brings attention to the client who formed the account with the bank. The depositing of large amounts of money into cash safes, at night, so that the person depositing the money does not have to deal with any of the staff that works at the bank or financial institute.

The main global policy making body that controls the framework for anti-laundering is the Financial Action Task Force or FATF. They develop and research any threats and also get companies to update their systems according to their data that was picked up through the research. The FATF develop and promote international policies to wage war against the large problem of illicit funds being laundered. The FATF makes constant reviews and recommendations; originally they had 40 recommendations which were updated in 2003 and continue to be updated to make it relevant and reflect to the increasing sophistication of the launderers and then make increased requirements for all financial systems are needed to combat them .

Systems are based on these guidelines set by the FATF, and all of the research that they have done in the field of the financial transactions. These findings have made a difference in the production of the software which protects the computer systems of all the many companies and organizations that might have been under the threat of illegal occurrences. These more accurate programs further halt the money laundering that may have happened or is happening in a company. The laundering that might have happened in the past can be traced and the proper authorities will be informed.

Money laundering being such a global problem has all financial institutions and banks around all working together. Information is shared and systems are constantly updated. In some cases the information that has been shared even makes the users of a particular system pay more attention to the certain aspect of the system. These systems are an especially important factor in the discovery of money launderers and in essence larger criminal activity that is occurring around, domestic and global. Criminal organizations can also be found through tracing the hints given off by these anti-money laundering systems.

There are many different systems all based off of these same requirements, CEO of Mantas; Simon Moss even described the people involved with money laundering operations as being “… probably better business people then we are”, from the assumption that every time a new security recommendation comes out the launderers are already on their way to finding another medium to launder the money. The money launderers always change what they do, keeping nothing a constant. He later also says about the money launderers, that they “…have assets at their disposal that essentially skim the financial institution, by being able to enter the market, say, in Asia, and exit the financial institution in Europe or in the U.S., or enter through a private banking relationship in one geography, but then exit through a brokerage relationship in another” .

Mantas has become possibly the set standard when it comes to Anti-Money Laundering or AML. Briefly, Mantas is a system which is easy to use and stays consistent with the information it receives. Some of the benefits reported from using this system include: comprehensive scenario coverage, advanced alert generation and workflow, customized thresholds and risk scoring, and enterprise-wide compliance .

As told on the official Mantas Anti-Money Laundering site; Comprehensive Scenario Coverage, where the clients realize greater protection with the Mantas system and faster time to compliance with Mantas’ industry-proven scenario libraries that provide comprehensive coverage of money laundering behaviors. These behaviors are known from past money laundering investigations, which were entered into the library. Advanced Alert Generation and Workflow, is a patented analysis technique that detects key behaviors of interest which indicate money laundering, a good example of this is the connections and relationships between different accounts. The alerts also provide a plethora of business data and historical information relevant to the accounts, and finishes by securing a resolution. The Customized Thresholds and Risk Scoring enables the financial institutions to shorten the investigation times and better manage risks to the system itself. In addition the user can also change the weightings for individuals or businesses to scrutinize activities because of certain suspicions. Enterprise-wide Compliance, Mantas Anti-Money Laundering systems support all types of businesses in different geographical locations, with the same effectiveness throughout.

The Solution

Mantas offers a wide range of services, tools, and applications to more than 5,000 professionals worldwide to improve their businesses. Mantas was originally designed for the largest and most sophisticated financial institutions, but is now used by many smaller institutions as well. All of Mantas’ services and applications may be found in one package called the “Mantas Behavior Detection Platform”. This platform serves as a foundation for an ever increasing set of business assurance applications. A firm or business may decide that they do not need the extra functions and applications that are in the platform; Mantas understands this and offers most of their products in separate forms as well. An example of a few of the other small products that Mantas offers includes: Mantas Loss Prevention, Mantas ONE, Mantas Advance, Mantas Select, Mantas Broker Compliance, Mantas Trading Compliance, Mantas Mutual Fund Compliance, Mantas Client Assurance, Mantas Case Management and Mantas Anti-Money Laundering.

The “Mantas Behavior Detection Platform” was a fifteen year long project that includes all of the tools and applications that Mantas has to offer. Every application is different and affects various aspects of the corporation or firm. During wartime, especially the war on terror, institutions have to become more aware of fraud and money laundering. The Mantas Anti-Money Laundering application helps regulators clamp down on loopholes in the systems that hackers, crackers, and even terrorists might abuse. This application is combined with the entire behavior detection platform and is used to monitor accounts, customers, and correspondents across business systems for suspicious activities and possible money laundering.

Mantas’ platform takes a look into hidden relationships between accounts to find possible money laundering activity. These relationships are the key for how money laundering operates, and the platform will automatically highlight these relationships. Analysts will be alerted to the detected behaviors and they will be provided with the entire context of the business data and historical information to help them find a solution. The Mantas platform is very intelligent and is capable of being used internationally. The platform supports different market structures, monitoring across global markets and can accommodate characteristics of different exchanges and currencies. The platform is also configurable to meet the specific business requirements from each company. Big corporations may have some personal requirements that include: discreet compliance jurisdictions, varying secrecy laws, and operational constraints. Money laundering typically operates across national boundaries and Mantas’ system is capable of monitoring global operations that criminals may run.

The Mantas system is derived from their use of “behavior detection technology.” (Pictured Above) This relatively new system is how Mantas is capable of detecting money laundering before, or as it actually happens. The technology allows companies to detect wrongdoing by finding suspicious patterns of behavior buried and hidden within all volumes of data. Criminals who use computers for money laundering crimes leave behind an electronic trail of data. This data reveals the story of their fraud by recording many critical events. For example, deposits, withdrawals, wire transfers, account openings, changes in power of attorney, trades, orders and quotes can all be recorded and logged. Criminals often use separate entities to carry out their schemes, establishing accounts under different names using a variety of financial products such as insurance policies or securities, and employing different traders. All of this data is captured and stored and analysts can backtrack to find out exactly how and when these events took place. Mantas helps distinguish the order in which the events took place, and this helps decide of the behavior is fraudulent or innocent. According to Mantas.com: “The key to behavior detection technology is its ability to identify suspicious events and entities that build over time, separate them from normal everyday events, and then to zero in on the wrongdoers. Without this sophisticated technology, it is likely that many suspicious behaviors will go undetected for long periods of time or not be uncovered at all.”

There are many challenges that the behavior detection system must face. For instance, the chief challenge is the sheer volume of data that must be examined. The suspicious behavior in question almost always is composed of many events and entities. Any single transaction in isolation may look normal, but it is only when the transactions are linked to all the other relevant transactions that it becomes suspicious. For example, a trade by itself looks normal, but in the context of other trades it may become apparent that it is part of a market manipulation scheme. A bank account by itself looks normal, but when that same account is linked to other accounts, a money laundering ring might be shown. The CEO of Mantas, Simon Moss explains more about the challenges in an interview by saying:

“Regardless of size, banks face four challenges. Cultural - AML is seen in many institutions as a problem to be solved at the business unit or geography level. This is a fundamental mistake. Money laundering is a cross-geography, cross-branch and cross-business challenge. Regulatory - The lack of data and uniformity across the market will always lead to systemic weaknesses. Training and Process - Technology is irrelevant if processes are not implemented and followed. Once these three challenges are addressed, a technology decision can be made. The result is better selection of a solution, better ROI and better compliance.”

The system is so advanced that it is capable of finding suspicious events and entities that are buried in between millions of legitimate events and entities. It uses “relationship examination” between the events to find strange activity. The intelligent behavior detection system is able to choose which relationships to examine and which to filter out. This behavior system is forced to play a game of “cat and mouse” with criminals. Once a criminal is caught by the system, they are forced to try a more sophisticated approach. In the same way, the Mantas system is forced to upgrade and update to find new measures of protection.

First generation detection solutions have been part of the financial community for a long time. These solutions work by establishing a fixed rules-based threshold by analyzing how certain established usage scenarios comply within the boundaries. Most financial institutions will establish a threshold based on a set of monetary value for each transaction, flagging any transaction over a certain level. There are three main areas where first generation systems had problems. The first area is when transactions are below defined thresholds. This means that the system was unable to detect money laundering schemes of smaller amounts that may come in under an established threshold limit. An example of this would be a criminal making several smaller deposits into several accounts instead of large deposits. The second area where problems arose was false positives. These are transactions over a set limit that are marked as suspicious but that do not represent any existing identified risk. These transactions caused old systems to take focus off other transactions that might be a true money laundering risk. The third area is behavior profiling. This is defined as the process where current industry information is used to profile and confirm certain patterns of suspicious laundering activity. An example of this would be comparing an electronic store to others in the industry. For example, all electronic stores’ sales usually drop during the spring but the system picked up one store that stayed the same and this became suspicious. This was not a very sophisticated method and federal regulations demanded more in depth and sophisticated information systems that are able to generate greater knowledge of the customer or user.

Mantas has improved on the shortcomings associated with the first generation anti-money laundering systems. The Mantas Anti-Money Laundering System has the ability to uncover suspicious financial activities by identifying the specific individuals or organizations that may be involved. This new system is able to learn and adapt, comprehending new money laundering schemes as they arise. The system takes an enterprise-wide approach, determining every transaction that is unusual as opposed to looking for a specific pattern or behavior while analyzing both the client profile and the transactions undertaken by the financial firm.

Mantas’ system is made up of four basic risk assessment components that ensure full disclosure and reporting necessary for compliance with the federal statutes. First the system looks at Client Risk Assessment. This relates to accessing a wide variety of detailed information relating to the customer’s account. This is typically collected at the time the account is opened. Mantas’ system looks at every type of analytical activities that are part of the client’s profile. For example, the system will list all names of other individuals that are affiliated with the account, it will list high risk countries that are associated with the account, it will list the channels that are used by the account holder and locations of the branch office and it will also list business relationships that are associated with the account.

Secondly, the new system will look at Transaction Risk Measurement. This is when the system views transactions that are determined to be of a higher risk and can vary from organization to organization based on their lines and type of business. For example, the risks associated with transactions from a bank would be different from those associated with an insurance agency or a securities firm. These transactions fall into three categories: fund related behaviors, transaction related behaviors, and miscellaneous behaviors. Fund related behaviors include transactions that generate receipts into the firm or payments made by the firm. Transaction related behaviors relate to behaviors where transaction values fall above specified limits and are apart from established internal guidelines that can pose higher levels of suspicious activity and risk of money laundering. Miscellaneous behaviors refer to frequent changes in an account and activities that show movement of funds without a corresponding trade and the deposit of excess money into an account.

The third component of the Mantas Anti-Money Laundering system is the behavior detection technology. Mantas has an entire platform of programs dedicated to this field, but it is also a big part in their AML system. This component manages the complex behavior that is commonly associated with money laundering schemes. This technology allows the firm or corporation to find suspicious patterns of behavior that may be hidden in between large volumes of financial data. The main key to this technology is the ability to identify suspicious events and entities that are built over time; this is what separates them from normal every day events and transactions. The behavior detection technology consists of four main components: scenarios, thresholds, alerts, and look back periods. Scenarios are a combination of rules and conditions which define the transaction pattern that is being detected. Thresholds are triggers that inform officials to potential scenarios. Alerts are the discovery of actual fraud scenarios. Alerts go off when there is a match of potential money laundering fraud. A look back period is a length of time monitored for a scenario in each run of the detection process. The time that is logged is usually dependent on the type of behavior that is being monitored.

The last component of Mantas’ system is Workflow and Reporting Tools. These tools aid financial institutions in the workflow and reporting process. They consist of case management, record keeping, and reporting. Case management provides an alert analysis workflow that is integrated with basic compliance reporting tools. Alerts that are generated from the Mantas Anti-Money Laundering System are pushed into these tools for further investigation. Most of the time, companies of firms alter these case management systems to be unique to their own standards. Record keeping is the ability to remain in compliance with federal laws that require the institutions to preserve their records for specific periods of time. This software allows scanning, imaging, indexing, and electronic storage of the physical transaction documents. The software allows easy accessibility and retrieval of the information. These documents are usually used to assist a money laundering investigation. The reporting features is an add-on feature for both the transaction monitoring and watch list filtering solutions that generate suspicious activity reports, and current transaction reports. Federal regulators typically use these to make customized reports during an investigation.

Example of related data discovered by the AML system.

These four components sum up how Mantas’ Anti-Money Laundering System works. The end user is capable of using this system for all of their needs. Many large corporations and firms do not disclose which anti-money laundering system they use because they feel it provides a risk. They feel that if a criminal knows which system they are using, they are already one step ahead of the actual system. Mantas is also used by many large corporations and firms who feel comfortable with publicly listing Mantas as their system of choice, simply because of the great reputation associated with the name. Mantas is able to provide a superior means of detecting new money laundering systems. These solutions go far beyond earlier systems by completely analyzing all related financial data in a greater level by scrutinizing smaller transactions and profiling and detecting account behaviors. Mantas’ System minimizes transaction risks ensuring full compliance with federal money laundering regulations. The future is bright for Mantas because they are capable of staying one step ahead of criminals by upgrading their Anti-Money Laundering system when new threats arise.

The Competition

Information technology has responded to the continued and wide-spread threat of money laundering through the development of more sophisticated systems. The variety of AML (anti-money laundering) management systems provides the financial industries with the ability to choose an AML detection system which will be most useful in their fight against this illicit act. Software vendors have recognized this problem and are in competition with one another to develop mainstream anti-money laundering packages. This is to the benefit of the financial industry participants because they can choose which system fits best into their business infrastructure and which will be the easiest, timeliest and most cost-efficient to adapt.

Mantas anti-money laundering system, which has been thoroughly discussed in this paper, is only one available solution to money laundering. Other competing system vendors are NetEconomy, SearchSpace, STB Systems, GIFTSWEB EDD System, Accuity, Readiminds, Actimize, SAS, IRS Intelligent Risk Management Solutions, and Norkom . However, with so many systems it is inevitable that a few will prevail amongst the rest.

Waters Magazine, an online magazine that “covers the practical implementation of technology in the securities industry” conducted a poll of its readers which covered six continents in order to find the industry’s best providers of tools and services; named three systems as the “best money-laundering solutions.” SAS came in first taking 38.1% of the poll, Mantas (which won the prior years poll) came in at a close second with 31% and in third place with 8.3% of the vote was SearchSpace . Therefore, according to this poll Mantas’ two major competitors are SAS and SearchSpace.

Mantas’ closest competitor is SAS. SAS anti- money laundering system stresses that it is the most reasonable monitoring system by taking the stance that what financial institution are looking for are systems that:

a) mitigate all risks identified in their risk assessments,

b) can be implemented in months rather than years and

c) have low infrastructure and support costs.

SAS promises that their system:

a) adapts easily to the organizations unique compliance needs by covering all risks in their risk assessment,

b) changes as the organizations business needs and regulatory expectations change and

c) can be implemented in three to six months, with a low total cost of ownership .

SAS solution offers an integrated and open-ended architecture that lets banks gather information across data sources, transform the appropriate data into real intelligence that has been tailored to the financial institutions unique risks, detect suspicious activity based on risk scores that incorporate KYC (know your customer) data, transactions, historical behavior and expected activity across all accounts and accurately alert investigators and authorities .

SAS has also catered their system to suit the size of the financial business by offering three versions of their solution; SAS Anti-Money Laundering, SAS Money Laundering Detection, and SAS Solutions OnDemand. Respectively these three versions accommodate large, global financial institutions to small- mid-sized financial institutions; they even accommodate to customers with limited IT resources in the Americas by providing them hosting options. The Bank of America, Sovereign Bancorp and Sky Financial Group are just a few among many other financial institutions which have chosen to adopt the SAS system as their anti-money laundering solution.

The second competitor to the Mantas behavioral detection system is SearchSpace. Recently SearchSpace and Segamix (a pioneer in Know Your Customer and enhanced due diligence) have joined to form a single product known as Fortent . Fortent’s major selling point is its “unbeatable one-two punch” according to Sandy Jaffee, CEO of Fortent .

The software makes use of advanced intelligent systems technology to dynamically develop individual customer profiles. Since AML patterns are constantly changing Fortent stresses that their distinguishing characteristic is that their system is able to detect previously unknown suspicious behavior by analyzing every transaction, every account and every customer across all product lines. The system continuously learns from transactions and customer behavior and updates itself without direct user intervention so new rules and AML scenarios are created automatically . Their second differentiating factor comes from their ability to deliver focused, accurate alerts that yield quality investigations and enhance staff efficiency.

The solutions major highlights are as follows :

a) Monitors and detects suspicious cash transactions, wire transfer, wire, ACH, ATM activities, monetary instrument transactions and loan defaults.

b) Monitors and detects suspicious activities across all business lines such as DDA, wires, trusts, deposits, loans, debit cards, etc.

c) Offers "Investigation Workbench" for support in detecting issues, while providing intuitive workflow that can be customized to coordinate with the bank's established workflow.

d) Employs variety of techniques, including rules, adaptive rules and contextual analytics.

e) Ranks all customers according to risk or degree of suspicion.

f) Profiles every transaction of every customer.

g) Self-adapts, creating new rules automatically and makes daily profile updates.

h) Allows users to install AML scenarios with both conventional rules and flexible comparisons which interpret activity using adaptive profiles for context.

The Fortent solution is endorsed by the Corporation for American Banking (CAB), giving it credibility and making it the choice for big institutions such as Commerce Bank and Washington Mutual. However, the solution is not only suited for big banks. Potentially, any size bank could use the solution; it has been designed to be highly scalable and flexible in order to meet the needs of any organization.

The Future

Although Mantas is one of the major systems available it does have competition within the industry, as previously mentioned. If Mantas plans to remain one of the top selling systems it has to continue to advance.

The future and success of the Mantas program seems to continue to progress with the years to come. Manta is continuing its global momentum. In Pakistan Habib Bank Limited is the largest bank in Pakistan. With an extensive network of 1425 domestic branches and 55 international branches, Habib Bank plays an important role in Pakistan's financial and economic development.

Pakistan is one of the many underdeveloped countries that have recently tried modernizing laws governing the country’s financial sector. Previously Habib Bank used very old school traditional ways to identify security issues by creating separate business unit solutions and manual processes to identify suspicious activity. With technology vastly improving, the bank decided it needed a more sophisticated, full-bodied and comprehensive platform to address regulatory compliance, protect its customers and brand, and prevent operational losses stemming from financial crime. After trying to figure out many different solutions Habib Bank chose Mantas ONE to address their compliance and risk management needs in a rapidly deployable and cost-effective manner. This was a major accomplishment for Mantas due to the fact that Habib Bank is largest bank in Pakistan.

This goes to show that Mantas still has worldwide brand recognition, and has an excellent performance track record and is price-competitive. If Mantas continues to grow popularity as it is, and remain price competitive in the near future, Mantas will eventually grab the attention of small-to medium sized banks not only across the nation but across the world.

In recent news Mantas a member of the Oracle Partner Network, announced on August 8, 2006 it has been authorized to resell Oracle Database software directly to Mantas customers. Oracle is the world's largest enterprise software company, and was the only vendor to offer solutions for every tier of a business. This is another innovation that has benefited Mantas, and shows it is making the right steps towards the future. Mantas can now sell Oracle Database to customers purchasing the Mantas solution, simplifying the process for Mantas customers with a single point of contact for their database, risk and compliance needs. Compliance officers in financial institutions, particularly regional and community banks will benefit from the convenience of having one vendor for all their database, compliance and risk management needs.

It is obvious that Simon Moss, CEO, of Mantas saw a need within their community and regional bank customer base to make it easier to find a way for the software purchases they need to be a smooth and successful process.

Mantas continues to innovate to compete with competition and remain on top in its industry for the present and future. With that being said on April 26, 2006 Mantas announced the release of Mantas 4.3, its flagship product that makes it easier for financial institutions to increase the performance of their compliance and risk management systems while lowering overall costs. It was designed to improve operational transparency, Mantas 4.3 features expanded fraud coverage, support for insurance anti-money laundering, world class watch list management, state of the art workflow and seamless integration of alerts to and from 3rd party systems.

Also costs savings available in Mantas 4.3 it makes it more readily and easily available in the future for banks or financial institutions of all sizes around the world to obtain Mantas, providing them with more safety then they previously had. “Mantas becomes an even more powerful and cost-effective choice for the compliance and risk management needs of any financial institution,” said Stephen Epstein, vice president, product management, of Mantas. The utilization of higher performance and lower-cost hardware gives Mantas 4.3 a two- to three-times performance gain over prior configurations. Mantas 4.3 is the first compliance platform available to utilize the performance benefits of 64-bit computing. Also Mantas’ Change in Behavior scenario was specifically designed to identify this complicated behavior, and is one of the few solutions capable of detecting and reporting this complex and difficult-to-find fraud. This is a significant change in the platform that continues to give Mantas a firm grip on being the leading competitor in its industry.

Another recent change that will better Mantas in the future is the sale of certain telecommunications business assets to Subex Systems, Ltd of Bangalore. This move brings several millions of dollars into Mantas’ core financial services business. It is obvious with this sale that Mantas sought greater focus on the continued success and growth of its financial services business. If Mantas wanted to continue to be the premier software provider to the global financial services compliance in the marketplace, this gain of millions of dollars was necessary.

To greater guarantee Mantas success in the near future Mantas has recently gained a new partnership with Teradata Warehouse 8.1, a suite of hardware, software and professional consulting services. This partnership will focus on enabling financial services executives to quickly and cost effectively manage current compliance requirements while establishing a flexible and scalable platform to rapidly and economically address future requirements.

Mantas will stay successful only if continues to provide its clients with the industry’s most advanced solutions for regulatory compliance, loss prevention and revenue generation. In recent news Mantas is now a wholly owned subsidiary of i-flex solutions. I-flex solutions is a leading IT solutions provider to the global financial services industry, with more than 660 customers in over 120 countries. I-flex’s range of products, custom solutions and consulting services enable financial institutions to cut costs, respond rapidly to market needs, enhance customer service levels and mitigate risk. I-Flex solutions has acquired Mantas for 122.6 Million dollars in cash.

S.Ramakrishnan, CEO of Reveleus-i-flex’s Business Analytics division, will take additional charge as CEO of Mantas. Also Simon Moss, who has provided leadership as CEO of Mantas, will take on the role of Strategic Advisor to i-flex, focusing on key projects and providing guidance and support for a smooth transition.

This partnership of two companies is a giant step towards progression for Mantas in the future. With this new merger Reveleus and Mantas will bring together two industry leading solutions into a single unified platform for governance, risk and compliance. Mantas merged with i-flex due to its exceptional performance in the the risk and compliance area. I-flex solutions have established strong credentials in the risk and compliance area, with its award-winning Reveleus solution suite enjoying rapid adoption by global Tier 1 organizations. The Mantas Behavior Detection Platform is the industry's most comprehensive solution for detecting risk and addressing regulatory requirements in the anti-money laundering, trading and broker compliance areas.

Management from Mantas and i-flex solutions feel that this merger will bring them great success in the near future. The new CEO of Mantas said that "The convergence of governance, risk and compliance, presents Mantas and Reveleus with a unique market opportunity to leverage our complementary strengths, I am very excited at the opportunity to address this critical customer need, and to establish a leadership position in this emerging space." So it is obvious that Mantas has the right person for the job someone that cares about the future of the company.

According to a Senior Analyst at a Boston based research firm “the coming together of i-flex and Mantas is expected to further enable institutions to 'close the loop' on risk assessment and AML/fraud operations – to not just provide a fuller picture of operational risks, but also generate insights to run the business smarter.”

It is obvious with these recent updates, and partnerships within Mantas that the company will have no problem maintaining its brand image, and quality in the anti-money laundering industry in the near future.

The Conclusion

While many anti-money laundering solutions have been in place for some time within the financial community, the efficiency by which these older AML solutions were able to detect, alert, and prevent potential money laundering schemes was dependent on the quality of the data collected by the financial institution, and the capabilities of the tools that are tasked with analyzing that data. As money laundering techniques become more sophisticated, so too has the technology used to detect such behavior.

The second generation AML solutions, such as Mantas, that are now available provide a superior means of detecting new money laundering schemes. These solutions go beyond earlier systems by completely analyzing all related financial data in a greater level of detail by scrutinizing smaller transactions and profiling and detecting account behaviors. This minimizes transaction risks ensuring full compliance with federal money laundering regulations. The Mantas solution should be strongly considered as a vital part or any strategic anti-money laundering plan that is part of the financial information infrastructure.

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Works Cited / Sources

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Kendler, Peggy. "Bank Systems & Technology: Anti-Money Laundering." Bank Systems & Technology. 2005. 29 Nov. 2006

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Mantas Inc. "The Leader in Operational Transparency for Financial Services| MANTAS." Mantas Inc Website. 2006. 29 Nov. 2006

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Retter, Terry. Anti-Money Laundering. Menlo Park, California: PricewaterhouseCoopers LLP, 2002.