FROM THE BATTLEFIELD TO THE BOTTOM LINE: USING MULTI-NODAL NETWORK ANALYSIS TO DETECT FINANCIAL RISK

Christopher Kenly Aveshka, Inc. Vice President Innovative Analytic Solutions

Bottom Line

We can leverage the lessons learned from the governments change in the way it is doing business after 9/11 and apply them to managing financial risk.
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Pre-9/11 Threats
Pre-9/11, how did we think about national security threats?

Nation-States

Regional Concerns

Narcotics

Economic Interests

Post 9/11
How do we view the new threat environment? We are faced with loosely affiliated groups united by ideology Not tied to nation-states Independently funded Operating globally Operating clandestinely Difficult to track/trace

Post 9/11
What has the battlefield looked like?
No frontline; attacks throughout the country

Limited visibility into enemy organization & operations Evolving adversary tactics & techniques

Post 9/11
How to deal with new threats?
New government agencies and programs to facilitate information sharing New efforts to collect and share critical infrastructure information and exploit open-source data sets Enhanced analytical techniques throughout government

Post 9/11
How to deal with new threats?
Multi-nodal network analysis to provide a 360 view of threat network Identifies previously unknown linkages using Dark Network Theory

Analytics in Action
New tools to identify and analyze threat streams, financial networks, and communications and conduct targeting and travel screening New technologies and techniques that allow an analyst to query data from multiple databases rapidly and comprehensively to provide information awareness and reveal hidden relationships

Threat Environment
How did we think about financial threats?
Systemic Risk Identity Theft Insider Trading Accounting Fraud Money Laundering Rogue Trading Ponzi Schemes

Pump-&-Dump Schemes
Leaks or Loss of IP
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Financial Battlefield
What does the financial battlefield look like?

Globalization of risk
Company brands at risk

Millions of transactions
Non-transactional data

Social media sources

Proprietary data sources

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How does it currently work?

Without analytics, researching and planning for the mitigation of risk is a cumbersome and intricate task.
Sifting through massive data sets, located in disparate databases, and existing in various formats Traditional mitigation based on transactional analysis often fails to identify hidden relationships and latent risks

Unknown exposure to risks results misinformed decision making

Financial Risk and Exposure

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Analytical accuracy and speed can vary across organizational divisions, experience levels, and subject domains

Lessons Learned
What lessons can we take from the battlefield and apply to financial risks?
Use multi-nodal network analysis and data analytics to help mitigate risk Multi-nodal network analysis Identify conflicts of interest Identify derogatory information (e.g., bankruptcies) Map social media relationships Determine front companies Identify operational tactics Data analytics Connect the dots Identify linkages quickly

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Analytics in Action

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Analytics in Action
How can analytics transform the financial industry?
Fraud Detection Anti-Money Laundering Intelligence Collection & Analysis Brand & Reputation Management

Competitive Intelligence

Transaction Monitoring

Risk Assessment

Due Diligence

If used correctly, it can truly be a game changer.

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Benefits of Analytically Enabled Multi-Nodal Network Analysis

Automated data collection and prioritization of results shrink the analytic timeline Customizable visualization tools highlight hidden relationships and new avenues of inquiry

Efficient Powerful Seamless Flexible Cost-effective

Single intuitive interface enables access to vast quantities of data from disparate sources
Cloud-based scalable architecture enables tailored inputs and outputs analysis and reporting on your terms Independent of your infrastructure so that it can be accessed anywhere with lower total lifecycle costs
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QUESTIONS?

Points of Contact
Innovative Analytic Solutions
CHRIS KENLY o | 571.814.5702 m | 609.372.5120 e | ckenly@aveshka.com

VICE PRESIDENT

Innovative Analytic Solutions

ADAM KILLIAN o | 571.814.5729 m | 571.243.4388 e | akillian@aveshka.com

PRINCIPAL

Innovative Analytic Solutions

SCOTT SCHNEIDERMAN o | 571.814.5737 m | 917.209.8829 e | sschneiderman@aveshka.com

PRINCIPAL

Innovative Analytic Solutions

KELLI COOPER o | 571.814.5745 m | 706.564.2411 e | kcooper@aveshka.com

ANALYST

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