What are velocity checks?

Controls that measure how quickly and often actions are performed.

They catch unusual activity that may indicate fraud or laundering.

Where are they applied?

In login security, payments, and transaction monitoring.

How do they support compliance?

By detecting structuring and high-risk behavioral anomalies.

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Velocity Checks

Overview

Velocity checks are fraud prevention tools that measure the speed and frequency of customer actions such as logins, transactions, or account changes. Unusually high activity may indicate fraud, account takeover, or mule behavior.

In AML, velocity checks are applied to transaction flows to spot structuring or smurfing attempts. Regulators expect institutions to configure thresholds that balance risk detection with customer convenience.Banks, fintechs, and payment providers implement velocity checks in real time to prevent losses and flag suspicious behavior. They are a core component of layered fraud and AML defenses.

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