AUTOMATION OF THE PROCESS OF FINANCIAL MONITORING OF LEGALIZATION OF ILLEGALLY ACQUIRED MONEY

  • Olha Kuzmenko
  • Hanna Yarovenko
  • Valentyna Levchenko
  • Serhii Mynenko
Keywords: financial monitoring; legalization of funds obtained in criminal way; automation; algorithm; flowchart

Abstract

The prototype algorithm for an automated module of a financial monitoring system based on the assessment of the risks of using financial institutions to legalize funds obtained in criminal way and to finance terrorism is developed and described in the article. Visualization of the proposed algorithm is implemented using flowcharts. The methodological tools of this study were such general scientific methods as analysis and synthesis, generalization, modeling and design. The result of the study is the prototype algorithm for an automated module of a financial monitoring designed to detect in real time financial transactions that fall under the signs of financial monitoring and classify bank customers as risky and not risky. The article describes the stages of this algorithm, the main of which are: 1) formation of an input data array in the context of individuals and legal entities (addresses, names, founders, information on the authorized capital and financial condition of the client); 2) risk assessment of the client (verification of compliance of the financial condition with the number of employees of the legal entity, verification whether the period of functioning of the legal entity is more than 3 months); 3) assessment of the riskiness of a financial transaction (verification of the frequency of transactions, verification of the excess of the amount established by law, verification of the riskiness of a payment, verification of compliance of the transaction amount with the financial condition of the client); 4) recording the information about the riskiness of the client and the operation to the database.
In this study, the analysis of public government registries was first used to evaluate a client of a financial institution. This algorithm can be used in commercial banks to identify transactions subject to the signs of financial monitoring and by state regulators in order to improve the national system for counteracting the legalization of funds obtained in criminal way and terrorism financing.

Published
2020-01-02
Section
Mathematical modeling and information technologies in economics