RISK ANALYSIS OF MONEY TRANSFER TRANSACTIONS

• US 20130132275A1
• Filed: 12/27/2011
• Published: 05/23/2013
• Est. Priority Date: 11/22/2011
• Status: Active Grant

• Current Assignee: Western Union
• Original Assignee: Western Union
• Inventors: Enzaldo, Robert, Varakin, Alexander, Baugh, Hollis, Brandt, Noel, Hall, Richard Alec, Gofstein, Bryant, Modi, Hiran, Kinkar, Niren, Patel, Viren
• Granted Patent: US 8,527,418 B2
• Time in Patent Office: Days
• US Class Current: 705/44
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/4016 involving fraud or risk level assessment in transaction processing
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03

Abstract

A money transfer system includes a risk assessment system and a risk modeling system. The risk assessment system uses rules engines and Z scores to assess, on a real time basis, risk factors associated with money transfers. The risk modeling system develops risk scores based on historical transaction data in order to create a risk model. The risk model may be analyzed over time to refine the rules engines and take other actions to understand and reduce the risk of improper activity in connection with money transfers.

Claims

1. A system for conducting a money transfer transaction for sending money from a sender to a recipient, comprising:

a money transfer host computer communicatively coupled to a transaction terminal for receiving money transfer information and for conducting the money transfer transaction in response to the money transfer information; and

a risk assessment system associated with the money transfer host computer for assessing on a real-time basis a risk of improper activity in connection with the money transfer transaction, the risk assessment system including at least one rules engine for evaluating the money transfer information received at the transaction terminal, the risk assessment system providing, prior to the money transfer transaction being completed at the money transfer host computer, a risk assessment of the transaction based on the evaluation of the money transfer information at the at least one rules engine;

wherein the risk assessment engine receives money transfer information having a value for at least one risk factor associated with the money transfer transaction, and wherein the risk score is calculated by the risk assessment engine by assigning a Z score to the risk factor, based on the formula;

2. The system of claim 1, wherein money transfer information is entered at the transaction terminal.

3. The system of claim 1, wherein in response to the risk assessment provided by the risk assessment system, the money transfer host computer causes the money transfer transaction to be:

a) approved, b) rejected, c) held in abeyance pending the receipt and assessment of additional money transfer information at the transaction terminal, or d) held in abeyance pending manual review of the money transfer transaction.

4. The system of claim 1, wherein the at least one rules engine is selected from a group comprising a data normalization engine, a data integrity engine, a list processing engine, a consumer identification engine, a business logic engine, a data aggregation engine, and a risk assessment engine.

5. The system of claim 1, wherein the risk assessment system includes two or more rules engines, and wherein the two rules engines are selected from a group comprising a data normalization engine, a data integrity engine, a list processing engine, a consumer identification engine, a business logic engine, a data aggregation engine, and a risk assessment engine.

6. The system of claim 1 wherein the at least one rules engine comprises a risk assessment engine, wherein the money transfer information includes a plurality of data categories, wherein the risk assessment engine aggregates data for at least one of the plurality of data categories and assesses risks associated with risk factors in the at least one data category.

7. The system of claim 6, wherein the plurality of data categories is selected from a group comprising payor, payee, agent, address, phone number, geographical location of payor, geographical location of payee, geographical location of agent, date of birth of payor, date of birth of payee, social security number of payor, social security number of payee, bank account number of payor, and bank account of payee.

8. The system of claim 6, wherein the at least one data category is the agent at which the payor is conducting the transaction.

9. The system of claim 6, wherein the risk assessment engine calculates a risk score associated with each of a plurality of risk factors associated with the at least one data category.

10. The system of claim 6, wherein the at least one data category is the agent at which the payor is conducting the transaction, and wherein the risk factors comprise one or more of (1) a number of transactions for the agent that have been included in a suspicious activity report, (2) a total amount of transactions for the agent included in the suspicious activity report, (3) a number of formal findings related to fraud that have been found for the agent, (4) an average value of transactions which are sent by the agent, (5) an average value of transactions in which money is paid to a payee by the agent, (6) a number of fraud complaints lodged against the agent, and (7) a total value of all transactions that have been the subject of a fraud complaint lodged against the agent.

11. The system of claim 6, wherein the risk assessment engine provides a risk assessment by calculating a risk score for at least one of the risk factors.

13. The system of claim 1, wherein the risk assessment engine calculates a Z score for each of a plurality of risk factors, and wherein the scores for the plurality of risk factors are combined into a composite risk score.

12. (canceled)

14. A method for real time assessment of a money transfer transaction for sending money from a sender to a recipient, comprising:

providing a money transfer host computer communicatively coupled to a transaction terminal for receiving, by one or more processors, money transfer information and for conducting, by one or more of the processors, the money transfer transaction in response to the money transfer information; and

providing a risk assessment system associated with the money transfer host computer for assessing on a real-time basis a risk of improper activity in connection with the money transfer transaction, the risk assessment system including at least one rules engine for evaluating the money transfer information received at the transaction terminal, the risk assessment system providing, by one or more of the processors and prior to the money transfer transaction being completed at the money transfer host computer, a risk assessment of the transaction based on the evaluation of the money transfer information at the at least one rules engine;

wherein the risk assessment engine receives money transfer information having a value for at least one risk factor associated with the money transfer transaction, and wherein the risk score is calculated by the risk assessment engine by assigning a Z score to the risk factor, based on the formula;

15. A method for assessing risk associated with a money transfer transaction, comprising:

receiving, by one or more processors, money transfer information having a value for at least one risk factor associated with the money transfer transaction;

receiving, by one or more of the processors, money transfer information having values for the same risk factor associated with prior money transfer transactions;

providing, by one or more of the processors, the money transfer information to a risk assessment system, the risk assessment system including one or more rules engines for assessing the risk associated with the money transfer transaction; and

assigning, at the risk assessment system, by one or more of the processors, a Z score to the risk factor associated with the money transfer transaction based on the formula;

16. The method of claim 15, wherein a Z score is assigned to each of a plurality of risk factors for the money transfer transaction, and wherein the method further comprises:

weighting, by one or more of the processors, the Z score for each risk factor; and

combining, by one or more of the processors, the weighted Z Score for each risk factor to provide a composite risk score for the money transfer transactions.

17. The method of claim 15, wherein the money transfer information includes data in a plurality of data categories, and wherein the risk factor for which the Z score is assigned is associated with at least one of the data categories.

18. The method of claim 17, wherein the at least one of the data categories is a money transfer agent at which a payor is conducting the transaction.

19. The method of claim 15, wherein the money transfer information includes data in a plurality of data categories, wherein each data category has a plurality of risk factors, with each risk factor having a value, and wherein the Z score is assigned to each of the plurality of risk factors associated with at least one of the data categories.

20. The method of claim 19, wherein the plurality of data categories is selected from a group comprising payor, payee, agent at which payor is conducting the transaction, agent at which payee is conducting the transaction, address, phone number, geographical location of payor, geographical location of payee, geographical location of agent, date of birth of payor, date of birth of payee, social security number of payor, social security number of payee, bank account number of payor, and bank account of payee.

21. A system for assessing risk associated with a money transfer transaction based on prior money transfer transactions, comprising:

a computer-readable memory having stored therein a sequence of instructions;

a processor, for executing the sequence of instructions to cause the process to assess risk associated with the money transfer transaction by;

receiving money transfer information having a value for at least one risk factor associated with the money transfer transaction;

receiving money transfer information having values for the same risk factor associated with prior money transfer transactions;

providing the money transfer information, associated with the money transfer transaction and with the prior money transfer transactions, to a risk assessment system, the risk assessment including one or more rules engines for assessing the risk associated with the money transfer transaction; and

assigning, at the risk assessment system, a Z score to the risk factor associated with the money transfer transaction based on the formula;

22. A method for refining rules in a rules engine, the rules engine for use in assessing risk of improper activity associated with money transfer transactions, comprising:

storing, by one or more processors, data for past money transfer transactions in a data base, including data for at least one risk factor;

receiving, by one or more of the processors, data for a new money transfer transaction, including data for the same at least one risk factor for the new money transfer transaction;

assigning, by one or more of the processors, an updated risk score to the at least one risk factor based on the data for that risk factor for both the past money transfer transactions and the new money transfer transaction; and

using, by one or more of the processors, the updated risk score to refine at least one rule in the rules engine;

wherein the step of assigning the updated risk score to the at least one risk factor based on the data for both the past money transfer transactions and the new money transfer transaction comprises;

calculating a Z score for the risk factor, based on the formula;

23. The method of claim 22, further comprising:

assigning, by one or more of the processors, a threshold value related to the risk score at which the at least one rule will be automatically refined; and

tracking, by one or more of the processors, the updated risk score, and when threshold value is reached for the updated risk score, automatically refining the at least one rule.

24. The method of claim 22, wherein using the updated risk score to refine at least one rule comprises:

based on the updated risk score, conducting an investigation of completed money transfer transactions to determine if there is an actual improper activity in connection with the transactions; and

refining, by one or more of the processors, the at least one rule based on the outcome of the investigation.

25-27. -27. (canceled)