Early Detection of Anti-Money Laundering (AML) Frauds in the Banking Sector Utilizing Artificial Intelligence

Praveen Asokan

Manager (Monitoring), Syndications, State Bank of India, New York

Abstract

Money laundering, the process of disguising illegally obtained funds as legitimate, continues to present significant risks to the banking sector. Financial institutions around the world face stringent regulations to prevent money laundering and combat terrorist financing. Anti-Money Laundering (AML) efforts are essential in ensuring the integrity and security of the global financial system. However, with the increasingly sophisticated methods employed by money launderers, traditional approaches to detecting suspicious activity are no longer sufficient. Artificial Intelligence (AI) has emerged as a transformative tool in combating money laundering by enhancing detection capabilities, automating processes, and reducing human error. This chapter explores the role of AI in early detection of AML frauds in the banking sector, focusing on its benefits, challenges, and the future of AML practices in an AI-powered environment.

Keywords

• Money Laundering,  Anti-Money Laundering (AML),  Banking Sector,  Financial Institutions,  Terrorist Financing,  Suspicious Activity,  Artificial Intelligence (AI),  Detection Capabilities,  Fraud Detection

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Cite this Article as Follows

Asokan, P. (2025). Technology and innovation in management practices: TIMP Feb 2025 [Hard Bound]. In D. James (Ed.), Technology and Innovation in  Management Practices (1st ed., Vol. 1, pp. 59–63). ASDF International. https://edlib.net/2025/timp1/timpfeb2025009.html