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Jack Henry Debuts Defense Against Money Laundering

Jack Henry

FinTech company Jack Henry has introduced a new tool to help banks combat fraud.

The firm’s Financial Crimes Defender, announced Monday (Oct. 16), is a cloud-native, real-time fraud and anti-money laundering (AML) tool for community and regional financial institutions.

“Fighting fraud with real-time data is the equivalent of catching an intruder at the front door, before they get into the house,” Matt Riley, president of complementary solutions at Jack Henry, said in a news release. 

“Financial Crimes Defender lets financial institutions detect and prevent fraud at first sight, ensuring assets and information remain within the institution. This is a game-changer for community banks and credit unions,” Riley added.  

According to the release, the defender offers real-time detection and prevention of fraud involving checks, deposits, transfers, ACH transactions and instant payments. 

“Financial institutions can stop transactions before they leave the institution or appear in the clients’ accounts,” Jack Henry said. In addition, its open architecture enables integration of third-party data into the platform, “improving overall fraud management for financial institutions across all relationships.”

The release noted that the Financial Crimes Defender is part of Jack Henry’s technology modernization strategy. It follows June’s launch of the company’s real-time, artificial intelligence (AI)-based fraud mitigation feature, known as the Payrailz Fraud Monitor.

The launch comes amid a spike in financial fraud, with younger consumers being especially targeted, according to joint research by PYMNTS Intelligence and Galileo.

That report found that 47% of retail banking consumers under the age of 40 have been a victim of some form of banking fraud, spotlighting the vulnerability of young people in today’s digital age. In addition, half of those who are financially overextended — meaning they have more debt than they can repay — have also fallen victim to fraud.

It’s a situation that has led many financial institutions to embrace modern tools like artificial intelligence and machine learning for their fraud-fighting efforts.

But “just going AI only is sometimes a bit of a too big step for most organizations,” Tobias Schweiger, CEO and co-founder of Hawk AI, recently told PYMNTS, stressing the need to hold onto some form of the old-school rules-based processes to which organizations have grown accustomed.

“We believe much more in a combination of the old world and the somewhat newer world of machine learning and AI, where the rules reflect the patterns that people want to stop or attend to and a second layer of ML and AI on top provides precision and agility,” he said.