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The Importance of Using Big Data in Combating Money Laundering

Head of the Center for Financial Transaction Reports and Analysis (PPATK), Ivan Yustiavandana, said that the wide opportunity to conduct digital transactions through various electronic payment facilities has resulted in a very complex ecosystem and has made it more difficult to identify and track suspicious financial transactions, thus triggering a high volume of transaction data.

Monitoring suspicious transaction patterns will be difficult to detect if only relying on traditional tools. The use of digital technology by money laundering actors is a challenge that needs to be addressed immediately by all parties, one of which is by using big data analytics

Big data analytics makes it possible to process and analyse large volumes of nonlinear data and identify hidden patterns and correlate seemingly unrelated data. Big data analytics is not only used to reveal a crime but can also predict an event through processing large volumes of data, both linear and nonlinear data from different sources so that it can detect anomalies quickly.

For PPATK and law enforcement, big data tools can be used to map and visualise so that they can provide a more complete picture of the flow of illegal funds and identify geographic areas, industries, channels and parties suspected of being involved in a crime. The use of big data analytics to combat money laundering is in line with The FATF Report on Opportunities and Challenges of New Technologies for AML/CFT.

PPATK is currently no longer able to work traditionally. In the era of technology 4.0 and the era of 5.0 Money Laundering, it is no longer time to work based on textbooks, but must be able to get out of the box. The dynamics of criminal acts that continue to develop rapidly are the reason, and Big Data is also one of their tools to carry out their actions. For this reason, it is necessary to have a common goal and commitment from all stakeholders to collaborate and synergise, creating a database that is assembled into valuable information to prevent various economic crimes.

The development of technological innovations has encouraged the development of financial products and services to become more advanced and complex, and the advancement of information technology that eliminates state boundaries has resulted in the facilitation of transnational organised crime, thereby increasing the risk of money laundering.

In response to these developments, the Financial Services Providers (FDD) which are under the authority of Bank Indonesia, such as Non-Bank Money Value Transfer Services and Foreign Exchange Business Activity Operators shall improve the quality of risk-based Anti-Money Laundering.

As reported by OpenGov Asia, Indonesia’s central bank, Bank Indonesia (BI), has continued its innovative initiatives by launching the long-awaited BI-Fast, a real-time retail payment system infrastructure, to meet public demand for fast, mobile, secure and low-cost transactions. BI-Fast was established to serve industrial consolidation and end-to-end integrated digital economy and finance (EKD), a national step toward realising the Indonesia Payment System Blueprint (BSPI) 2025 and to meet public demand for a fast, easy, affordable, safe, and reliable payment system, according to BI Governor Perry Warjiyo.

BI-FAST is a national retail payment system that allows people to make payments using a variety of instruments and payment channels in real-time, 24 hours a day, seven days a week. Real-time transaction settlement at the bank and customer levels, 24/7 availability, real-time validation, and notification, use of a proxy address as an alternate solution recipient account number, and reliable security features such as fraud detection and an anti-money laundering/countering the financing of terrorism (AML/CFT) system are just a few of the highlights of BI-FAST. Individual credit transfer services are expected to be available by the end of 2021.

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