Nationwide Building Society, the largest mutual company in the United Kingdom, has seen quick results after installing enterprise risk monitoring software from NetEconomy, Netherlands.
"It's detecting suspicious transactions that we would have been unaware of prior to its installation," said Russell Johnston, head of legal compliance (consumer affairs) and deputy group money laundering reporting officer at Nationwide Building Society. "We are seeing suspicious transactions, and we have notified the police of a couple already."
NetEconomy's Erase system is being used initially on banking and savings accounts, which comprise 20 million customers, 50 million accounts and 60 million transactions per month. To date, over 240 million transactions have been profiled and stored. Later, Nationwide will deploy the system throughout its lending, mortgage, credit card, unit trust and treasury services businesses.
Between 1.5 and 3 million transactions are processed by the system daily. All transactions are stored for reference purposes for 13 months; only transactions above 50 pounds are profiled.
The system may eventually be expanded to perform marketing. "At the moment, we're just concentrating purely on anti-money laundering procedures," said Johnston. "But in the fullness of time, because this is telling us much more about our customers, we might be able to use it for different reasons-marketing, for example."
Detecting and deterring money laundering is serious business in the United Kingdom. "The Financial Services Authority has got the power to fine and to reprimand all financial organizations that they have responsibility for," said Johnston. "But over and above that, the money laundering reporting officer and other directors have a personal liability as well. They could, if they got things badly wrong, face imprisonment themselves."