Hawk AI Secures $56 Million to Enhance AI-Powered Financial Crime Detection

Hawk secures $56 million to expand financial crime detection platform - SiliconANGLE

Hawk secures $56 million to expand financial crime detection platform Artificial intelligence-powered anti-money laundering and fraud prevention solutions company Hawk AI GmbH announced today that it had raised $56 million in new funding to support continued product innovation and global expansion, particularly into the U.S. market. Founded in 2018 by fintech veterans Tobias Schweiger and Wolfgang Berner, Hawk has as its mission to assist financial institutions in combating financial crime more effectively and efficiently through the use of explainable AI. The company's platform offers a suite of products designed to enhance risk coverage and operational efficiency, including Payment Screening, Transaction Monitoring, Customer Screening, Customer Risk Rating, AML AI Overlay, Transaction Fraud Detection and Entity Risk Detection. The platform integrates traditional rule-based methods with AI to allow financial institutions to detect suspicious activities in real time while significantly reducing false positives. One of Hawk's more interesting services is its AML AI Overlay solution, a service that allows banks to augment their existing AML systems with AI capabilities without the need for a complete system overhaul. The solution reduces false positives and enhances the detection of novel criminal activities while also improving compliance workflows and risk detection accuracy. Hawk's technology is built on a cloud-native architecture to ensure scalability, reliability and security. The platform supports multi-cloud deployments across providers like Amazon Web Services Inc. and Microsoft Corp.'s Azure, offering global coverage with low latency. The company's solutions are used by varying clients, including banks, payment companies, neobanks, fast-growing fintechs and cryptocurrency platforms. Notable Hawk customers include Ecobank Transnational Inc., VakifBank International AG, Worldline S.A., North American Bancard LLC, Synctera Inc., Computer Services Inc., Volt Bank Ltd., Vodafone Group plc and VR Payment GmbH. One Peak Partners LLP led the Series C round, joining existing investors Macquarie Capital Group Ltd., Coöperatieve Rabobank U.A., BlackFin Capital Partners S.A.S., Sands Capital Management, DN Capital Group Ltd., Picus Security Inc. and Coalition Inc. "The value that Hawk delivers to AML and fraud teams around the world is truly remarkable," commented David Klein, co-founder and managing partner at One Peak, in a press release. "Financial institutions of all sizes attest to Hawk's ability to deliver impressive results, exceptional reliability and collaborative support."

Hawk raises $56m for AI-powered fraud prevention

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community. Macquarie Capital, Rabobank, BlackFin Capital Partners, Sands Capital, DN Capital, Picus, and Coalition joined the round for the German regtech. Hawk enables banks to move beyond the traditional rules-based approach to AML and fraud, claiming that its AI-powered technology helps dramatically increase accuracy to find more crime, while reducing false positives. The company now has more than 80 customers globally, ranging from large Tier 1 banks to mid-market financial institutions and fintechs. The new funding will be used in part to push expansion into the US. Tobias Schweiger, CEO, Hawk, says: "AI is in our DNA at Hawk. Our mission is to provide financial institutions with the technology, the expertise and the support that they need to realize the transformative impact that machine learning and generative AI can have across their anti-financial crime operations."

Hawk Raises $56 Million to Help Banks Counter Financial Crime | PYMNTS.com

The Germany-based company says its Series C round, announced Tuesday (April 8), will help it finance further product innovation and fuel expansion efforts, especially in the U.S. "Hawk enables banks to move beyond the traditional rules-based approach to anti-money laundering and fraud," the company said in a news release. "Traditional systems create significant problems for compliance teams, including huge volumes of false positive alerts that need to be reviewed, which in turn leads to staffing challenges and costs." The company added that criminals can also find ways to subvert the rules, causing illegal activity to be overlooked. Hawk says its artificial intelligence (AI)-powered tools can boost accuracy to uncover more financial crime, while reducing false positives. "Every financial institution that wants to reduce compliance workloads and increase the accuracy of risk detection should be using AI to achieve those goals," Hawk CEO Tobias Schweiger said in the release. "The results are compelling -- we've been able to increase alert accuracy to almost 90% in some cases, while significantly cutting false positives. We're also uncovering twice as many previously undetected cases of 'novel' criminal activity." The round comes at a time when banks are calling for stronger anti-money laundering (AML) and fraud protections. At a hearing before Congress last week, witnesses from the industry called for a "whole government" approach to fighting payment and investment scams. Darrin McLaughlin, executive vice president and chief AML and sanctions officer for Flagstar Bank, testified on behalf of the American Bankers Association, saying that 1 in 3 American adults had experienced financial fraud in just the past 12 months. "Bad actors have leveraged cutting-edge technologies, social media and telecommunications to target Americans' life savings," he told the House Financial Services Subcommittee on National Security, Illicit Finance, and International Financial Institutions. "We need a strategic approach" that includes the banking industry, the government and other stakeholders, he said, and that "regulatory reforms let us focus on the real threat." Meanwhile, research by PYMNTS Intelligence shows that -- in keeping with Schweiger's argument -- a majority of financial institutions (FIs) are using technologies such as AI and machine learning (ML) to uncover and prevent fraud.