How AI Can Impact the Role of a Financial Investigator?

In early Fiscal Year 2023, the U.S. Treasury Department made a significant stride in fraud prevention, recovering over $375 million by incorporating AI into their fraud detection processes. 

After their press release in Feb 2024, Deputy Treasury Secretary Wally Adeyemo, in a statement to CNN, said, “We are using the latest technological advances to enhance our fraud-detection process, and AI has allowed us to expedite the detection of fraud and recovery of tax dollars,”

The government’s dedication to leveraging AI ethically in the fight against financial crimes is further evidenced by the appointment of Jonathan Mayer in the US Justice Department as the inaugural official tasked with focusing on AI to counteract fraud.

Despite the workforce’s concerns regarding AI’s impact on employment, President Biden’s Executive Order on the responsible adoption of AI technology offers reassurance. The order clarifies that AI’s purpose is to augment, not replace, jobs, serving as an essential support tool that improves efficiency and simplifies the fraud investigation process.

This article provides a deeper insight into the impact of AI in financial investigations and shares detailed information about an upcoming AI training Summit for financial fraud investigators. Read on!

Role of AI in Financial Fraud Investigations

Criminals rely on money laundering to fund drug and human trafficking and to provide resources for terrorist organizations like Hamas and smaller groups inspired by the ideologies of al-Qa’ida (AQ) and the Islamic State of Iraq and ash-Sham (ISIS).

Besides funding terrorism, illegal immigrants pay exorbitant fees to cross the United States SouthWest border, contributing billions annually to criminal entities. Between 2021 and 2022, FinCEN (the Financial Crimes Enforcement Network) recorded four million human smuggling encounters on the SW border. 

Over the years, financial fraud has evolved significantly. Criminals now employ sophisticated methods like shell companies and AI technology to launder money. These methods obscure the source of the funding, making it challenging for financial investigators to trace.

But like Bryan Keighery, a partner at law firm Morgan Lewis, said, “A well-trained AI is capable of identifying subtle patterns and connections in data that…would be near impossible to be identified by humans.” 

By leaning on AI, fraud investigators can stay ahead and effectively detect and fight financial crimes. Here’s a look at how AI is changing the game in financial fraud investigations in the USA:

Entity Link Analysis

AI-based entity link analysis involves leveraging advanced machine learning algorithms to analyze vast data and identify hidden relationships between entities.

This process involves gathering and integrating data from diverse sources—transaction records, shared addresses, bank accounts, and more—to detect potential illicit activities without moving any data. 

Financial investigators leverage these AI systems to analyze transaction details, such as timings, frequency, and amounts, aiding in tracing laundered money. Here is a detailed explanation of how it works in financial crime investigations.

  • Scope Determination: Identify relevant data by focusing only on essential datasets to avoid unnecessary analysis. AI-based entity analysis is a scalable approach which allows for data adjustment as needed.
  • Data Collection and Extraction: Utilize AI to swiftly gather and process data from diverse sources, extracting key entities such as customers, accounts, and transactions relevant to the investigation.
  • Link Analysis and Visualization: Apply AI software to automate the discovery and visualization of connections among entities, analyzing transactional patterns and relationships for clear interpretation.
  • Anomaly Detection: Detect unusual behavior and suspicious links, leveraging systems like ScanWriter for quick and accurate report analysis and anomaly flagging.
  • Investigative Insights: Highlight entities and relationships that require deeper examination to provide actionable insights.

Forensic Accounting

Traditional methods often fall short when it comes to complex financial fraud schemes. But with AI technology, forensic accountants can detect complex patterns, such as structuring, layering, and integration, often used in money laundering schemes. 

Below is a breakdown of the three use cases under forensic accounting.

Structuring and Smurfing

Structuring is the act of breaking down significant transaction amounts into smaller amounts to avoid suspicions with investigators and law enforcement. In the United States, financial institutions must report all cash transactions exceeding $10,000.

So, instead of depositing a large amount at once, say $300,000, the individual will split and parcel the cash into $10,000 transactions at intervals. These transactions become hard to flag and trace as they do not trigger the automated reporting systems.

While tracking such transactions is a little more complex, financial fraud investigators can use AI to analyze trades for unusual patterns based on various data points like transaction values, initiation locations, and account activity.


Layering involves shifting money between numerous accounts across different banks and countries to obscure the source of funds, making tracing more challenging.

Financial investigators at government agencies can leverage AI to prevent or detect layering using models trained to recognize common money laundering patterns.


Integration occurs when an individual combines illicit funds with legitimate assets to conceal their origin. Financial investigators can use AI to prevent or detect integration by implementing robust transaction monitoring, screening, risk scoring, etc.

Amid rising financial fraud concerns and heightened expectations from the U.S. citizens, ScanWriter’s much-anticipated AI Training Summit offers a sneak-peak into cutting-edge tools to enhance your investigation process. Secure your spot now and meet these challenges head-on.

AI Training Summit: Be at the Forefront of AI Innovation

As promised, the big reveal is here: the 2024 AI Training Summit, an exclusive anti-fraud conference tailored for fraud investigators in the public sector like you. It will be an electrifying event where the brightest minds unite to revolutionize the fight against financial crimes through AI! 

You’ll get to dive deeper into how AI supports your role as an investigator and also discover cutting-edge strategies to outsmart money laundering, recover assets, and tackle fraud with the power of AI. 

This event will occur on May 15-16, 2024, at the prestigious National Press Club in Washington, DC. It’s your golden opportunity to network with top financial investigators, sharpen your skills, and forge invaluable connections. 

The AI training Summit is strictly for financial investigators working at the USA’s federal, state, and local government agencies. Spaces are limited—secure your spot by registering today.


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