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From Brazil to Dubai, Israeli startup secures billions of dollars from money laundering

ThetaRay protects cross-border transactions by Payoneer and other financial giants

ThetaRay CEO Mark Gazit (fourth from left) at the Abu Dhabi Global Market in 2021 (ADGM)
ThetaRay CEO Mark Gazit (fourth from left) at the Abu Dhabi Global Market in 2021 (ADGM)

Continued turmoil from the coronavirus and Russia’s war in Ukraine are putting added pressures on financial institutions to make sure cross-border payments aren’t running afoul of economic sanctions on Moscow or falling prey to scammers.

ThetaRay, a rapidly growing Israeli FinTech company, is being deployed to the front lines of this effort, securing hundreds of billions of dollars in cash flows against money laundering and other financial crimes. Cross-border payments, already valued at $37 trillion, are growing swiftly due to burgeoning digital platforms, but undetected financial crime is holding back revenue growth.

The company’s proprietary algorithms analyze transactions against dozens of risk indicators associated with financial crimes to detect anomalies that suggest criminals and terrorists are moving money.

Payoneer, the world’s go-to partner for digital commerce, chose ThetaRay to monitor cross-border payments on its global platform. The need for flexibility and nimbleness were paramount attributes when Payoneer set out to choose protection against new and evolving threats, says chief compliance officer Micheal Sheehy.

“Machine learning and artificial intelligence will enable us to adapt and respond to our models and risks a lot faster,” Sheehy said. “We looked a lot at everyone’s machine learning and how it works, but we were super impressed when we went through our proof of concept with ThetaRay.

“We’re able to maneuver their system in a very efficient and speedy manner to meet our needs effectively, so that we can focus on the things that we really need to focus on.”

ThetaRay’s other customers include Mashreq Bank in the UAE – a first for an Israeli company – and three of the 12 largest correspondent banks outside of China. This month, the company signed a deal with Travelex Bank, Brazil’s largest foreign exchange specialist.

“ThetaRay is the only provider we’ve found that meets out high business standards by providing both AI-based transaction monitoring and sanctions screening within one platform,” says Celia Pizza, Chief Compliance Officer at Travelex Bank.

By ensuring trust in cross-border and domestic payments, the Israeli startup can enable financial institutions to expand their business opportunities to areas once considered risky.

Failure to comply with regulatory anti-money laundering and data privacy programs cost financial institutions billions of dollars each year in fines.

The growing need for protection against fraud saw ThetaRay sign 10 new contracts in the second quarter of 2022, including the deal this month with Travelex.

“Travelex Bank represents a new generation of global institutions that is readying its money transfer and payment infrastructure for changing conditions,” says Mark Gazit, ThetaRay’s CEO. “We are very proud and excited to build this partnership with Travelex that will help fuel growth of the global economy.”

ThetaRay, founded in 2013, is in the process of raising additional funds from investors, including OurCrowd, Israel’s most active venture capital fund.

Accredited investors can join ThetaRay’s current funding round via the OurCrowd platform. For more details, click HERE.

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