Sandbar Gets $4.8M to Fund Fight Against Financial Crime


Sandbar says it has raised $4.8 million to enhance its financial crime detection software.

The funding, announced by the New York FinTech Tuesday (Jan. 24), comes amid an uptick in financial crimes and an increase in fines against companies for failures in their anti-money laundering (AML) efforts.

“Transaction monitoring is tough, but it doesn’t have to be,” Sandbar Co-founder and CEO Brock Bontrager said in a news release.

“It’s the foundation of any successful AML program, and it’s most effective for the financial institution and broader ecosystem when it’s easy to integrate, understand, and use. It’s unfortunate to see still so many risk and compliance teams resource-constrained and dependent on manual tools, especially now.”

Sandbar says its product helps organizations fortify their AML program by offering a more effective model to spot suspicious behavior.

“By offering an API-based plug-and-play solution for financial products and services, Sandbar reduces the need for time-consuming and expensive engineering resources,” the release said, adding that it consolidates multiple compliance products to save companies time and money.

Sandbar’s funding comes as financial institutions are seeing a rise in financial crimes, and showing an eagerness to find tools to reverse the trend.

A new collaboration by PYMNTS and Featurespace — “The State of Fraud and Financial Crime in the U.S. ” — shows that 62% of large banks are facing an increase in financial crimes, with large financial institutions (FIs) with more than $5 billion in assets collectively bearing almost $120 million in average fraud costs last year.

“The issue is affecting customers as well,” PYMNTS wrote Jan. 20. “Earlier this week, the fastest man in the world and legendary gold medal-winning Olympian Usain Bolt reportedly lost $12 million due to a bank scam.”

Research by PYMNTS and Featurespace also found that 95% of anti-money laundering executives considered it a high priority to use innovative tools to improve fraud detection and AML compliance. These tools include machine learning, artificial intelligence (AI) and cloud-based platforms.

Nearly half of the respondents said they were using new technology controls. And of this group, 50% were increasing their use of real-time decisioning and alerts.

Last week also saw the news that penalties for failing to stop financial crimes rose by more than 50% in 2022, as financial institutions were fined nearly $5 billion for AML violations, breaches of sanctions and flaws in their know-your-customer (KYC) systems.