EverCompliant, the pioneer of Electronic Money Laundering Detection and Prevention (also known as Transaction Laundering), announced a strategic investment from American Express Ventures, which joins existing investors Arbor Ventures, Carmel Ventures, StarFarm Ventures and Nyca Partners.
EverCompliant will use the funds to ramp up its team and continue to optimize and develop new technology.
Transaction Laundering occurs when a fraudster uses a legitimate online merchant account to funnel illegal transactions through a merchant processor, online marketplace or other merchant service provider. The continued growth of online commerce has created more opportunities for illicit players to use legitimate online storefronts to mask their identities, leading to an increase in Transaction Laundering.
EverCompliant's automated detection capabilities enable merchant service providers to identify and eliminate unknown and fraudulent merchants. Continual monitoring and verification of third-party identities helps merchant service providers prevent the processing of fraudulent transactions, reducing the risk of chargebacks, financial losses and damage to their reputation. EverCompliant's research shows that, on average, there are 6%-10% additional unknown and unregistered merchants over the size of a merchant service provider’s known portfolio, who are illegally committing Transaction Laundering. This phenomenon amounts to nearly $500 billion a year worldwide. These transactions may involve illegal goods sold by unregistered merchants, demonstrating that Transaction Laundering fraud is a growing issue for the payments industry.
"We are thrilled that American Express has decided to invest in our company," said Ron Teicher, CEO of EverCompliant. "Their investment shines a spotlight on a growing problem in the payments industry. Having a strong relationship with this global payments network, paired with our continuous merchant risk management capabilities, will equip the industry with what they need to combat this new form of money laundering."
"EverCompliant's technology is helping merchant acquirers, payment aggregators and other service providers prevent bad actors from infiltrating their systems and ensure only legitimate transactions get processed," said Harshul Sanghi, Managing Partner of American Express Ventures, the strategic investment group of American Express. "As more commerce shifts online, the need for advanced solutions that can help payment service providers fight fraudulent transactions will continue to grow. We look forward to helping EverCompliant as it addresses increased demand for its technology."
EverCompliant's customers currently include some of the largest institutions across North America, Europe, and Asia, who collectively monitor millions of merchants within their platform. The company's proprietary and highly-effective method for uncovering Transaction Laundering has fueled a growing demand among merchant service providers and yielded a 300%+ increase in company growth in 2017.