DARPA asking for ideas on automating money laundering detection
(2025/01/28)
- Reference: 1738089069
- News link: https://www.theregister.co.uk/2025/01/28/darpa_auto_money_laundering_detection/
- Source link:
Tracking down and preventing money laundering is a slow, time-consuming, manual procedure. DARPA is hoping it can provide some relief for exhausted analysts by automating the process.
The Pentagon's Defense Advanced Research Projects Agency announced the Anticipatory and Adaptive Anti-Money Laundering (A3ML) program last week with news it's [1]seeking research proposals for "rapid graph-search algorithms" that are able to sift through financial transactions for suspicious patterns.
A3ML doesn't just aim to sniff out shady dealings, though: DARPA is also calling for algorithms that can anticipate future activities, aiming to transform anti-money laundering (AML) from a reactive to a proactive process – all while reducing privacy risks by avoiding the sharing of sensitive financial data.
[2]
"The way we address these threats today is largely through manual data collection and analysis methods that threaten privacy," said A3ML program manager David Rushing Dewhurst. "We are looking for new technological ideas that preserve privacy while setting a course to end our adversaries' financial warfare."
[3]
[4]
The need for such technology is a serious one. North Korea, infamous for its financial crimes, [5]stole $659 million in cryptocurrencies in 2024, much of which has likely been laundered [6]through [7]various [8]methods . That doesn't include [9]fiat money laundering conducted on behalf of North Korea. Thankfully, Dewhurst told us that both fiat and crypto currencies are within A3ML's scope.
The US government estimates that half of North Korea's nuclear program is funded by laundered cash, DARPA said. Beyond the Kim regime's penchant for financial crime, a federal indictment [10]alleges that money launderers tied to Chinese underground banking provide financial services to Mexico's Sinaloa cartel, a concern noted in the context of the A3ML program.
[11]
"Money laundering finances our adversaries' weapons programs, global terrorism, and the illicit drug trade, all of which threaten U.S. national security," Dewhurst said.
The Basel Institute on Governance, which has tracked progress in fighting money laundering since 2012, said in its 2024 year-end [12]report that, while compliance is up around the globe, the effectiveness of AML measures has actually declined in recent years. According to the Institute, AML measures are only effective 28 percent of the time, down from 30 percent in 2021.
In short, something's gotta give, and it might as well include some new technology to improve effectiveness – and put a layer between analysts and raw, private financial data.
[13]
Per DARPA, the proposal specifically aims to develop algorithms that "represent patterns of illicit financial behavior in a concise, machine-readable format that's also easily understood by human analysts." Results would be extracted from financial databases "without directly sharing sensitive financial data," though the particulars will be up to participants in the program to figure out.
"A3ML technology will be designed to share illicit financial behavior templates instead of sharing sensitive financial information," Dewhurst told The Register . In other words, the intent is to establish a list of tactics, techniques, and procedures used by money launderers, not share specific info.
[14]Laundering cash from healthcare, romance scams lands US man in prison for a decade
[15]Dark web crypto laundering kingpin sentenced to 12.5 years in prison
[16]Anti-money laundering bill targeting cryptocurrency introduced in US Senate
[17]Feds reach for sliver of crypto-cash nicked by North Korea's notorious Lazarus Group
As to whether full-fledged AI models are being considered, Dewhurst told us "any technical solution that can enable the algorithmic extraction of financial tactics, techniques, and procedures from heterogeneous transaction data" is on the table.
"If widely adopted, A3ML would lower compliance costs and risks for industry, increase the accuracy and precision of illicit finance data available to the US government, and drastically reduce the sharing of Americans' sensitive financial information," Dewhurst added in an email to The Register .
As to when A3ML solutions could actually start stopping real-world money laundering – this is a research project, after all – don't expect immediate results. A3ML aims to fill the AML operational gap "as quickly as possible," Dewhurst told us, but [18]Proposers Day for the project isn't happening until February 20, with actual proposals not [19]due until March 10.
After that, it remains unclear what researchers actually come up with, so no rest for the weary AML analysts. There are countless rows of records to pour through still. ®
Get our [20]Tech Resources
[1] https://www.darpa.mil/news/2025/tackle-illicit-finance
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2025/01/15/north_korea_crypto_heists/
[6] https://www.theregister.com/2022/08/08/treasury_sanctions_tornado_cash_korea/
[7] https://www.theregister.com/2022/08/08/treasury_sanctions_tornado_cash_korea/
[8] https://www.theregister.com/2023/10/19/north_korea_fake_freelance_avoidance/
[9] https://home.treasury.gov/news/press-releases/jy2752
[10] https://www.justice.gov/opa/pr/federal-indictment-alleges-alliance-between-sinaloa-cartel-and-money-launderers-linked
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[12] https://baselgovernance.org/news/global-fight-against-money-laundering-progress-paper-success-elusive
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[14] https://www.theregister.com/2024/05/22/health_care_and_romance_frauds/
[15] https://www.theregister.com/2024/11/11/bitcoin_fog_sentencing/
[16] https://www.theregister.com/2022/12/15/antimoney_laundering_crypto_bill/
[17] https://www.theregister.com/2024/10/08/us_lazarus_group_crypto_seizure/
[18] https://www.darpa.mil/events/a3ml-proposers-day
[19] https://sam.gov/opp/22562059531b4979814b8b9fcd03e3ec/view
[20] https://whitepapers.theregister.com/
The Pentagon's Defense Advanced Research Projects Agency announced the Anticipatory and Adaptive Anti-Money Laundering (A3ML) program last week with news it's [1]seeking research proposals for "rapid graph-search algorithms" that are able to sift through financial transactions for suspicious patterns.
A3ML doesn't just aim to sniff out shady dealings, though: DARPA is also calling for algorithms that can anticipate future activities, aiming to transform anti-money laundering (AML) from a reactive to a proactive process – all while reducing privacy risks by avoiding the sharing of sensitive financial data.
[2]
"The way we address these threats today is largely through manual data collection and analysis methods that threaten privacy," said A3ML program manager David Rushing Dewhurst. "We are looking for new technological ideas that preserve privacy while setting a course to end our adversaries' financial warfare."
[3]
[4]
The need for such technology is a serious one. North Korea, infamous for its financial crimes, [5]stole $659 million in cryptocurrencies in 2024, much of which has likely been laundered [6]through [7]various [8]methods . That doesn't include [9]fiat money laundering conducted on behalf of North Korea. Thankfully, Dewhurst told us that both fiat and crypto currencies are within A3ML's scope.
The US government estimates that half of North Korea's nuclear program is funded by laundered cash, DARPA said. Beyond the Kim regime's penchant for financial crime, a federal indictment [10]alleges that money launderers tied to Chinese underground banking provide financial services to Mexico's Sinaloa cartel, a concern noted in the context of the A3ML program.
[11]
"Money laundering finances our adversaries' weapons programs, global terrorism, and the illicit drug trade, all of which threaten U.S. national security," Dewhurst said.
The Basel Institute on Governance, which has tracked progress in fighting money laundering since 2012, said in its 2024 year-end [12]report that, while compliance is up around the globe, the effectiveness of AML measures has actually declined in recent years. According to the Institute, AML measures are only effective 28 percent of the time, down from 30 percent in 2021.
In short, something's gotta give, and it might as well include some new technology to improve effectiveness – and put a layer between analysts and raw, private financial data.
[13]
Per DARPA, the proposal specifically aims to develop algorithms that "represent patterns of illicit financial behavior in a concise, machine-readable format that's also easily understood by human analysts." Results would be extracted from financial databases "without directly sharing sensitive financial data," though the particulars will be up to participants in the program to figure out.
"A3ML technology will be designed to share illicit financial behavior templates instead of sharing sensitive financial information," Dewhurst told The Register . In other words, the intent is to establish a list of tactics, techniques, and procedures used by money launderers, not share specific info.
[14]Laundering cash from healthcare, romance scams lands US man in prison for a decade
[15]Dark web crypto laundering kingpin sentenced to 12.5 years in prison
[16]Anti-money laundering bill targeting cryptocurrency introduced in US Senate
[17]Feds reach for sliver of crypto-cash nicked by North Korea's notorious Lazarus Group
As to whether full-fledged AI models are being considered, Dewhurst told us "any technical solution that can enable the algorithmic extraction of financial tactics, techniques, and procedures from heterogeneous transaction data" is on the table.
"If widely adopted, A3ML would lower compliance costs and risks for industry, increase the accuracy and precision of illicit finance data available to the US government, and drastically reduce the sharing of Americans' sensitive financial information," Dewhurst added in an email to The Register .
As to when A3ML solutions could actually start stopping real-world money laundering – this is a research project, after all – don't expect immediate results. A3ML aims to fill the AML operational gap "as quickly as possible," Dewhurst told us, but [18]Proposers Day for the project isn't happening until February 20, with actual proposals not [19]due until March 10.
After that, it remains unclear what researchers actually come up with, so no rest for the weary AML analysts. There are countless rows of records to pour through still. ®
Get our [20]Tech Resources
[1] https://www.darpa.mil/news/2025/tackle-illicit-finance
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.theregister.com/2025/01/15/north_korea_crypto_heists/
[6] https://www.theregister.com/2022/08/08/treasury_sanctions_tornado_cash_korea/
[7] https://www.theregister.com/2022/08/08/treasury_sanctions_tornado_cash_korea/
[8] https://www.theregister.com/2023/10/19/north_korea_fake_freelance_avoidance/
[9] https://home.treasury.gov/news/press-releases/jy2752
[10] https://www.justice.gov/opa/pr/federal-indictment-alleges-alliance-between-sinaloa-cartel-and-money-launderers-linked
[11] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[12] https://baselgovernance.org/news/global-fight-against-money-laundering-progress-paper-success-elusive
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33Z5lhjiqfLBQIO550D_9WYgAAAQI&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[14] https://www.theregister.com/2024/05/22/health_care_and_romance_frauds/
[15] https://www.theregister.com/2024/11/11/bitcoin_fog_sentencing/
[16] https://www.theregister.com/2022/12/15/antimoney_laundering_crypto_bill/
[17] https://www.theregister.com/2024/10/08/us_lazarus_group_crypto_seizure/
[18] https://www.darpa.mil/events/a3ml-proposers-day
[19] https://sam.gov/opp/22562059531b4979814b8b9fcd03e3ec/view
[20] https://whitepapers.theregister.com/
False positives FTW!
may_i
It's bad enough already with all the petty restrictions on what I can do with my own money without having to look forward to being dragged out of bed at 4AM by a bunch of trigger happy goons just because some fucked up ML model decided to flag me.
ummmmmm....
Omnipresent
Maybe you should start by looking at how the US politicians do it? Just ask mitch and the gang. They're experts.
beast666
Here's an idea:
Stop laundering money through Ukraine.
Omnipresent
^^^ There's your ruspublican, ask him.
It's done through Ukraine
Anonymous Coward
Because when you try to do it through Russia, Putin & his gang steal all of it.
It's easy to spot in any country...
IGotOut
Freeports.
Art
Stock Exchanges.
There that's 90%
The other 10%?
Mobile phone shops
Vape shops
Those clothes shops you see in shopping centres with 10 staff and 1 customer (per day).
Re: It's easy to spot in any country...
heyrick
Hairdressers? I was talking to a friend in Somerset who said he can't get over how there's six hairdressers in the town centre and few people ever seem to be inside. It's probably a front for the local Mafia wannabes, and a convenient place to quietly get hooked up - you hand over papers of dead royalty and they'll hand back some reality alterations.
the first thing they need to do....
stiine
The first thing they need to do is increase the $600 reporting limit based on the inflation since that rule was implemented. If I remember correctly, a few years ago, that number should have been increased to at least $200000. Otherwise, they can F right off.
Dark spots
chivo243
Too bad we have places like Switzerland and the Caymans, they are like a redacted document in the banking world.
Sorry, I can't help
I'm too busy training my AI to launder money, and I'm way behind everyone else.