Photo by Karen Roche Verafin, a company comprised of Memorial students, faculty, and alumni has developed a computer software solution to crack down on illegal money transfers and money laundering. (Clockwise from top left) engineering students and company partners Brendan Brothers, Saifuddin Mohamed, Charles Robertson and Raymond Pretty (seated). Unavailable for photo were Jamie King and Brian Kidney.

By Aimee Sheppard
After Sept. 11, 2001, the way the world does business changed and in Memorial’s Faculty of Engineering and at C-CORE the work of two post-graduate students also changed. The tragic events of 9/11 were a wake-up call to financial institutions and regulatory bodies around the world to tighten their security measures and work more diligently to prevent money laundering as a means to fund terrorism. Jamie King and Raymond Pretty switched gears from robotics research and their company known as Intrignia Solutions to focus on finding an anti-money laundering (AML) answer. Now their AML company Verafin, developed in a “Fast Track” process in the P. J. Gardiner’s Entrepreneurship Gateway, has the potential to crackdown on terrorist financiers and money laundering activities.

In October 2002, Memorial alumnus David Kelly saw an opportunity for his alma mater to embark on a research project to help solve a worldwide problem. Kelly, an expert in the cash management industry, saw that the sector needed more sophisticated AML software. Armed with a proposal to fund the research, he approached Dr. Bob Richards at the P.J. Gardiner Institute for Enterprise and Entrepreneurship and the two put together a project team of people from the Faculties of Business Administration and Engineering. The result is a group of Memorial students, including King and Pretty, along with faculty and alumni who developed Verafin and launched their money laundering detection product Pulse in New York in May 2003 only seven months after the development process began.

Verafin has impressed the industry with the efficacy and sophistication of their product and with their targeted rapid response to an industry problem. “For our robotics research we were dealing with artificial intelligence and a rule-based system of fuzzy logic,” said King. “When Dr. Richards and Mr. Kelly approached us with the AML problem, we soon discovered we could apply the same concepts to this new area.”

“Our product identifies patterns representing possible financial crimes such as money laundering among the millions of daily financial transactions,” said King. Once integrated into a company’s computer networks, Pulse can quickly scan all transactions and flag any suspicious activity including large deposits, withdrawals and client names. For example, if an individual’s banking activities are considered suspicious and are being monitored by a regulatory body, Pulse will flag all transactions made by that person and transactions made by people with names that are spelled or sound alike.

There are other detection products in the marketplace, however none that were conceived specifically for the AML problem. Among Verafin’s many competitive advantages is its integration time. It can take large organizations like banks more than a year to integrate other products into their current systems. Given the strict regulatory requirements to detect and report, banks can incur large fines and reputation damage in that period of time. Verafin’s software can be integrated in about two weeks. Verafin, now a client company in the Genesis Center, is demonstrating its product to banks in the Caribbean and United States and finalizing partnerships with distributors in international markets including the Middle East and Australia.