Valley Bank is investing in anti-money laundering capabilities as its peers face regulatory repercussions for AML practices. 

The $62 billion bank has been using Tara, the AI AML agent from digital solutions provider WorkFusion, for a year, Chris Phillips, director of anti-money laundering compliance at Valley Bank, told Bank Automation News. 

“Financial crime is growing like weeds,” Phillips said. “As compliance requirements increase … banks are looking to technology to improve their screening services.”

WorkFusion, based in New York City, uses AI to identify suspicious activity that can be resolved without human intervention, David Caruso, vice president of financial crimes compliance at WorkFusion, told BAN.  

AI reduces “time spent on low-value tasks,” he said, allowing bank employees to handle high-impact issues and evaluate already screened AML transactions with fewer false positive flags. 

The bank averages 110,000 international transfers a month, Phillips said. In the past, its AML process flagged 22,000 transactions, which included some false positives. 

“Tara immediately cut 50% of that,” he said, adding that Tara has been trained on Valley Bank’s data and is able to flag 65% of money laundering transactions. 

The accuracy of Tara is close to 90%, Phillips said, adding that if it “can’t close a case, [it] leaves it open for a human to look at.” 

Deutsche Bank, Scotiabank and Bank of Asia are WorkFusion clients, according to the company. 

Use of AI for AML

TD Bank, Starling Bank and First National Bank of Dennison were among financial institutions fined for noncompliance with AML regulations by regulators in 2024. 

TD is investing in data and technology to improve AML compliance after being fined $3 billion by U.S. regulators in October 2024, according to the Department of Justice’s Oct. 11 release. 

Financial institutions need to “focus on continuous training for compliance teams to keep pace with evolving laundering techniques,” Tracy Moore, director of thought leadership and regulatory affairs at financial compliance service provider Fenergo, told BAN. 

AI can aid AML “efforts by analyzing large volumes of data to identify suspicious patterns and connections that human analysts might miss,” Moore said. 

AI is becoming the norm at many companies, with development and deployment of the tools have been steadily rising since the pandemic, according to the September 2024 CBInsights’ “Future of workforce” report. 

Companies that develop AI uses raised more than $2 billion between 2022 and 2024, compared to $1 billion between 2020 and 2022, the report stated. 

After successfully integrating AI into its AML screening, Valley Bank is evaluating other processes where it can deploy AI to gain efficiencies in 2025, Phillips said. 

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