VC, Alphabet fund development of AML products

Internal and external investment in digital identity-based, crime-curbing AI continues.

Venture fund Notion Capital has put $11 million into fintech Resistant AI’s series A round, which already held $16.6 million. GV, the corporate venture capital unit of Alphabet, participated in an earlier round.

That announcement came a week after Alphabet’s subsidiary, Google Cloud, announced the availability of an anti-money laundering AI algorithm.

Everyone involved in both events is motivated by big numbers that keep getting bigger – like $2 trillion. That is how much money that the United Nations estimates is laundered annually.

SmartSearch, another anti-money laundering software vendor, sponsored market research by Censuswide that reportedly found that laundering through just cryptocurrency in the United Kingdom last year involved £6.4 billion (US$8.1 billion).

Little wonder why, then, venture firms are interested in an equity stake in any play that looks competent.

Resistant reports that its fraud prevention, KYC and AML customer base doubled last year, and annual recurring revenue grew sixfold.

Resistant executives say they are plowing the new investment into the expansion of its product and headcount. They also want to move into new geographic markets.

Of particular focus for the executives is automated attacks that create fraudulent identities at large scales.

Google Cloud, meanwhile, hopes to deter businesses from using manually derived rules for alerting to likely fraud. The rules are not impossible to discern and nothing good happens after that.

Its proprietary machine learning-based algorithm, according to the company, generates risk scores that are part of a software process that is more nuanced and accurate. The scores are based on KYC data, network behavior, transactional patterns and other data points that each bank tracks and can be updated often.

According to Google Cloud, an international bank reported that it detects two to four times more true positive risk with the new AML software compared to its previous process.

Article Topics

AI  |  AML  |  financial services  |  funding  |  Google  |  identity verification  |  KYC  |  Resistant AI  |  SmartSearch