Navigating the Labyrinth: Artificial Intelligence in the Battle Against Trade-Based Money Laundering
Governments worldwide are stepping up their KYC and AML efforts in response to the increasing prevalence of Trade-Based Money Laundering (TBML). TBML employs techniques such as over-invoicing, under-invoicing, and misrepresentation of goods to launder funds through trade transactions. Despite TBML possibly accounting for 80% of global illicit financial flows, detecting it remains a challenge due to the frequency and complexity of global trade transactions. The article highlights the potential of AI in combating TBML and discusses recent legislative developments aimed at tackling cross-border financial crimes. Balancing rigorous screening with the need for accuracy is pivotal in mitigating the threat posed by TBML.