Despite enormous investments in Anti-Money Laundering (AML) detection - from advanced monitoring systems to large compliance teams - money laundering remains alarmingly persistent. Criminals stay several steps ahead, while financial institutions find themselves trapped in a game of "compliance theatre". AML detection is inherently difficult: money launderers are agile, adaptive, and operate across borders and institutions. But the real challenge lies not just in complexity - it’s in the misaligned incentives and checkbox mentality that dominate the system. Financial institutions are required to: Implement a predefined set of detection rules (which are often public knowledge among criminals) File Suspicious Activity Reports (SARs) when certain patterns or thresholds are triggered The cost of AML is staggering compared to its measurable benefits. For example, in the Netherlands, it’s estimated that around 20% of bank employees - roughly 13,000 people - are enga...
Financial literacy remains a global challenge, not only in developing nations or among those with limited education, but also among university graduates, even those with degrees in economics. Despite access to financial knowledge, people consistently make irrational decisions : overspending, under-saving, mismanaging risk, or ignoring better alternatives. For decades, the default response from governments and institutions has been education. The theory goes: if people understand money better, they’ll make smarter choices. But the data tells a different story. While education can raise awareness, its impact on long-term behavior is often marginal and short-lived. The truth is simple: knowledge alone rarely changes behavior . People change when they have a reason to, i.e. a financial incentive, a social signal, or an emotional trigger. To truly improve financial health, we need to focus not just on teaching, but on changing behavior . Fintechs and banks are beg...