Transaction monitoring

Like a watchful sentinel guarding a kingdom's treasures, transaction monitoring is the process of observing and analyzing financial activities to detect unusual patterns, anomalies, and potential fraud, ensuring the security and integrity of financial systems and protecting customers from unauthorized transactions and loss.

Example

A bank may employ transaction monitoring systems to review its customers' account activities, such as deposits, withdrawals, transfers, and purchases. By continuously examining these transactions, the bank can identify any irregular behavior that may indicate fraud, money laundering, or other illicit activities. For instance, if a customer who typically makes small, infrequent transactions suddenly starts making large, repeated transfers to an overseas account, the transaction monitoring system may flag this activity as suspicious, prompting further investigation and potentially preventing financial loss or criminal activity.