By Andrew Jolley, CAMS | Fraud SME, FiVerity
Introduction: Automation’s Limits Are Holding Institutions Back
Financial Institutions are on the front lines of an arms race they didn’t ask for—one where fraudsters are using new and emerging technology to exploit outdated defenses. In response, many institutions have turned to automation as the answer.
But here’s the hard truth: automation alone is not solving the right problems.
Traditional rule-based systems—designed to accelerate transaction monitoring and streamline workflows—are now overwhelmed. False positives can make up to 95% of alerts, drowning analysts in noise. Meanwhile, collaborative fraud investigations (under 314(b)) remain manual and slow. And suspicious activity reports (SARs)? Still built by hand, often over several days.
What is missing?
An intelligence layer that connects internal systems and external insights to make automation smarter - not just faster. Within the next 2-3 years, more than 40% of financial institutions will be implementing some form of automation in their risk management programs. (ACFE 2024 Report to the Nations)
The Three Core Challenges Automation Hasn’t Solved
1. Alert FatigueToday’s AML systems generate more noise than insight. Without context, even basic automation tools can't distinguish high-risk behavior from false flags. This overwhelms analysts and leads to burnout or worse, missed red flags.
2. 314(b) BottlenecksSection 314(b) was designed to enable inter-institution collaboration, but in practice, it’s bogged down by compliance concerns, email threads, and guesswork. Most institutions aren’t using it at all, and that is because the tooling or software doesn’t fully support it.
3. SAR Creation BottlenecksDespite available automation tools, SARs often take five or more days to complete due to fragmented data and manual compilation. These tools typically streamline documentation, but don’t reduce false positives; leading to overloaded pipelines and limited prosecutorial value.
When handled in isolation, SARs reinforce data silos and contribute to inefficiencies like duplicate filings, amendments, and defensive SARs. Proactive use of 314(b) collaboration enables institutions to corroborate suspicions earlier, reducing unnecessary filings and improving the overall quality and impact of reports.
Enter the Intelligence Layer: Automation, Activated by Insight
A collaborative intelligence layer is a dynamic system that pulls together signals from:
- Internal systems (e.g., transaction monitoring, fraud tools, case files)
- External insights (e.g., peer fraud reports, public alerts, law enforcement, shared threat intelligence, partner data sources)
This layer uses AI, machine learning, and behavioral analytics to prioritize alerts, match fraud across institutions, and pre-fill SARs—all in real time.
But it doesn’t stop with automation. It changes how fraud and compliance teams work together, removing silos and accelerating response through collaboration. A smooth transition from detection to investigation and a clear roadmap to prevention are what results with a shared intelligence layer.
Key Benefits of a Collaborative Intelligence Layer
Real-Time 314(b) Collaboration
With A collaborative intelligence layer transforms 314(b) from a manual, resource-heavy process into a streamlined, proactive workflow.
By automatically correlating fraud patterns, securely routing requests, and pre-filling response templates, it removes the operational burden that often deters participation. This reduces legal friction, accelerates response times, and increases overall engagement.
The result: greater participation, faster insights, and higher-quality intelligence—making 314(b) a powerful, embedded tool for coordinated fraud prevention.
Accelerated SAR Workflows
With shared threat data and AI-powered case enrichment, SARs can be drafted in minutes - not days. Some institutions now automate 95% of their SAR creation.
Holistic Customer Risk Profiles
By bridging data across departments and external sources, institutions gain a full view of risk—connecting fraud, AML, and compliance for unified decision-making.
Why This Matters Most for Community Banks and Credit Unions
These institutions are disproportionately affected by fraud:
- 79% report over $500K in direct fraud losses annually
- Many operate with legacy systems and lean teams
- Limited resources make manual review unsustainable
An intelligence layer levels the playing field by allowing institutions to access the power of collaboration and shared fraud defense, without the overhead of custom-built tools or large teams.
Implementing an Intelligence Layer: A Smarter Path Forward
Start Small, Integrate Quickly
Most intelligence layers, like FiVerity’s platform, can plug into existing systems and deliver day-one value without complex integrations.
Prioritize Use-Cases with the Highest Impact
Start where the pain is greatest: false positives, delayed SARs, or slow fraud response.
Invest in Collaboration
Train fraud, compliance, and AML teams to work on shared platforms. Align data, processes, and goals for joint investigations.
Ensure Explainability
Modern AI tools are increasingly “explainable,” meaning institutions can track how decisions are made—critical for audits and regulatory reviews.
Conclusion: Automation Without Intelligence Is Automating the Wrong Work
Financial institutions don’t need more rules - they need better insight.
They don’t need faster alerts - they need the right ones.
And they don’t need more automation - they need smarter automation.
A collaborative intelligence layer provides that missing link.
By uniting internal systems and external insights, and empowering teams to act together, this approach transforms fraud, AML, and compliance operations from cost centers into strategic operational assets.
Explore the FiVerity Anti-Fraud Collaboration Platform
FiVerity’s platform delivers the intelligence layer modern financial institutions need by offering:
- Shared fraud detection across the community
- Integrated 314(b) collaboration
- Enriched SAR support
- Automated alerts with real-world prioritization
To see how your institution can go from overwhelmed to empowered, schedule a demo today.