Synthesizing Data for Collusion-based Malpractice of Shell Companies in Money Laundering

Detection of shell companies in financial institutions using dynamic social network

“…The literature related to the detection of shell companies is scarce. A first study is by Pawde, Apte, Palshikar and Attar (2018), which used synthetic data to simulate the collusion-based malpractices of shell companies. They incorporate this proposal into Banking Transaction Simulator (BTS) to generate data sets and tackle the problem of shell-set detection.…”

“…Mechanism and techniques of shell companies' action as those reported by FATF are also of great importance. Although studies as Pawde et al (2018) and Luna et al (2018) have considered the industrial sector, number of employees and revenues, in simulated data, the reality in financial systems makes necessary to incorporate more mechanisms present in the interaction between legal entities such as the nature of business relations, addresseses in common, virtual offices, etc. The same applies when metrics obtained from financial statements are considered as the main criteria of detection, as in Aggarwal and Dharni (2020).…”