The Tech that Leads to the Traffickers

Fifty million people. That’s the estimated number of vulnerable people being preyed upon by modern-day enslavers or other types of trafficking groups, according to the International Labor Organization (ILO). It’s equivalent to the population of California and the numbers are growing: the ILO’s 2022 report calculated that over the five previous years, the number of those trapped in some form of modern slavery has grown by 20%, an additional 10 million more people ^[1].

Meanwhile, the exploiters themselves collectively earn an estimated $34 million every hour of every day from their crimes, according to ILO estimates; rewards that are huge and intoxicating. For example, Bonifacio Flores-Mendez, a Mexican-born man sentenced to life in prison in the US in 2014 for trafficking women and then forcing them into sexual slavery in a network of New York City brothels, admitted at the time of his sentencing that he was motivated simply by “greed,” according to news reports.

But that greed and the modern digital movements of money, coupled with the traffickers’ growing reliance on technology to recruit and groom their targets, create openings for law enforcement. At some point, many individuals and organizations involved in trafficking rely on the global financial system to minimize the costs of their illicit activities and reduce the risks involved in moving money.

“Perhaps no single person or organization can observe all the human behavior that adds up to this kind of criminality,” says Tracy Manning, director of financial crime at LexisNexis^® Risk Solutions in Atlanta. “But they leave digital footprints. And there’s one common tie between all kinds of trafficking — money laundering.”

^[1] Global Estimates of Modern Slavery: Forced Labour and Forced Marriage

Tracy was still a child when a young relative told her about being a victim of sexual abuse and exploitation within the family. “I ended up having to testify in court,” she recalls grimly.

Later, Tracy was in college when she realized that the internet — becoming ubiquitous — could become a feeding ground for pedophiles such as the individual who had victimized her young relative. That prospect “lit a fire in me,” she says. Tracy decided to create a chat room and social media profiles that made her look like a pre-teen or young teenager and wait for predators to reach out to her. When that happened — over and over again — she’d arrange to meet the predator. When they arrived at the restaurant or movie theater, they’d find instead members of law enforcement waiting to greet them.

But removing predators from the scene one at a time felt like trying to drain the ocean with a teaspoon. “As satisfying as it felt, I couldn’t be everywhere at once; I couldn’t outsmart all these organized criminals,” Tracy recalls today. As she went on to build a career in marketing and branding, she sensed the overwhelming power of technology to scale and conceal bad behavior. “For criminal networks, all it took to succeed was for us not to collaborate and share information with each other in the way that they did.”

In 2018, Tracy joined LexisNexis Risk Solutions, knowing she had landed somewhere she could work with colleagues to “root out the evil that affects the lives of real people.” A lightbulb moment came when she connected financial flows with sexual exploitation and trafficking: the greater the number of warning signs that new analytics tools could identify in a financial institution’s data and records, the easier it would be to spot suspicious activity that could be passed to law enforcement. “It’s all about filtering data, spotting patterns, and using machine learning to get a scalable solution,” she says. “Banks don’t witness the moments when trafficking victims are saved or the impact of failing to stop this activity but I have. It reminds us all that fighting financial crime is about more than checking a compliance box. It’s about real lives.”

After a career in public accounting and banking — part of which he spent combatting financial fraud — Terry Schappert was ready for a change. The Knoble Network is a nonprofit organization bringing together businesses and other entities to combat human trafficking and other abuse of society’s most vulnerable. Terry became its head of financial institution relationships, a way to combine his lifelong commitment to giving back to society with his professional skills and the network of contacts he had built up during his career.

Most compliance officers “see things that don’t look right, and don’t feel good,” he explains. “But you don’t know for sure. You can’t make the linkages and can’t prove that scams are running through individual accounts.” Now, one of his tasks is to introduce financial industry peers to the analytical models that can delve more deeply into transaction patterns, as well as to other organizations that can help banks understand and combat what’s happening.

“I’m responsible for getting all of them engaged and making sure they all realize the difference they can make,” he adds.

The first major venture undertaken by The Knoble was launched in 2021. The financial institutions that collaborated on Project Umbra drew on the increasingly sophisticated data tools powered by LexisNexis Risk Solutions to develop new ways to identify accounts that seemed likely to be part of online child sexual exploitation. As the pandemic pushed more kids to spend more time online, nonprofit organizations spotted signs that this was growing rapidly. “Predators hang out at gaming sites, start buying things for kids, then move on to purchasing software making them anonymous, and transferring money,” Terry says, grimly. “And then…”

Spotting that activity among millions of accounts seemed like looking for needles in an immense haystack. But Project Umbra and the sophisticated data analysis that powered it made converts of participants who doubted its efficacy. Reviewing millions of accounts, the model quickly flagged 17 as worrying — 10 of which were referred to law enforcement after further scrutiny. “That kind of precision is remarkable,” Terry says.