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HNW Individuals

High Net Worth Individuals

This is especially the case in regard to High Net Worth (HNW) individuals. A large number of organizations monitor the transactions of HNW individuals in a separate complementary process along with a more formal annual KYC review. These traditional monitoring systems really struggle to handle the lifestyles of the new rich and produce meaningful warning or reports that can be used to assess customer behavior. With top end handbags often costing in excess of £20,000 the alerts holistically triggered run the risk of simply creating noise rather than information.

A traditional transaction monitoring platform does not provide any context to customer behavior. Has the customer’s behaviour profile changed since the last review? Simply looking at income and outgoings for a customer is not enough it maybe exactly as the customer has said (say \\$4MM income \\$3.8MM expenditure) — so is an alert for a \\$20,000 handbag what KYC should really be looking for?

What the organization really needs to do is to look at the sources of the income; the countries, investments, companies of familial links. The nature of the expenditure. The nature of the expenditure also need to be what has been brought, where and how? The nature of these transactions need to be reviewed holistically, perhaps a customer bought a company in a previous year and then continues funnelling money to this investment. It is only through using a holistic view that you can get analysis data to give you the context to knowing something different has happened in regard to entities and individuals concerned.

A holistic view enables you to connect these counter parties to see if these financial interactions make sense. The ability to monitor activity in context of a holistic view enables the organization to have valuable insights on what these individuals are doing. This information can in turn be used to more effectively assess an individual for AML issues and risk. This is an important lower level analysis task that knowledge graph excels at because as most large scale money laundering tends to involve networks of individuals and organizations with a controlling force. The EKG enables the easier identification of all networks (bank accounts, transactions and customers) which in turn allows for swift analysis of alerts. A cluster of automatic alerts all in a given network identified by the \glsxtrshort{ekg} can be swifty escalated for review (this is detailed further in the use case \usecaseref{uc:aml}).