Co-Founder Spotlight: Andreas Bayer (CTO)

Andreas Bayer CTO Co-founder beam solutions software paypal xoom machine learning ai

Beam’s technical team is headed by Andreas Bayer, Beam’s CTO and co-founder. Andreas brings over 20 years of experience delivering software solutions to the financial industry. His experience includes PayPal, Xoom, and 14 years of teaching advanced software design at UCSC Silicon Valley Extension. At PayPal, Andreas provided strong technical leadership to the Xoom risk engineering team integrating into PayPal’s global risk environment. Prior to that, he formed and lead a team which designed and built Xoom’s proprietary fraud detection and regulatory compliance ecosystem from the ground up. Andreas received his B.Sc. in Computer Science from Dortmund University of Applied Sciences and Arts, Germany.


What brought you into the compliance industry?

For fintech startups, regulatory compliance is usually not the first thing on their radar. In order to focus on their core value proposition, companies satisfy regulatory obligations to the bare minimum and typically through cumbersome manual processes. This was no different when I joined Xoom, an MSB in its early days as a software engineer. Eventually, the manual burden became unmanageable and engineering was approached to explore automation and tools. Our research quickly revealed a lack of providers with meaningful solutions. Most players used to cater to larger government arms and the technology involved was unacceptable from a cost/benefit and maintenance standpoint. It was time for me to step up into a technical leadership role and my team then decided to design and built the necessary tools and backend systems to detect suspicious activities and generate SARs from the ground up. We repeated the same exercise on sanctions, initially focused on OFAC matching. Down the road, we extended SAR filing and sanctions into other jurisdictions. Although I ran fraud and compliance engineering at Xoom and later PayPal, my passion was always in solving regulatory compliance challenges. There is something rewarding about hitting deadlines set by government entities and creatively interpreting vaguely defined obligations to deliver cost effective solutions, only to later receive compliments by auditors and even reading about our success indirectly in the news. It’s been a great privilege to work with every stakeholder in compliance, pulling on the same string to catch the bad guys and to prevent the worst from happening. Most companies satisfy the bare minimum but at Xoom, I was given the opportunity to go beyond with latest technological advancements including AI and machine learning, which also contributed to the company’s success in combating money laundering and related crime, serving as a role model on compliance in the industry.

What excites you the most about Beam?

When someone approaches you and asks you to jointly shape the compliance landscape and lead the technology behind next generation regulatory compliance solutions you better accept, right? At least that’s what you should do when you are passionate about compliance in the payments industry and you care about making the world a better place. It simply was a call from heaven and a very natural decision to make. I am extremely thrilled to have the opportunity to work with Ben and everyone else on the team to make a change in the compliance industry that traditionally lags a decade behind. With Beam, everything I could wish for came together — start from the beginning again, focus on regulatory compliance covering the wider financial industry, leverage latest technologies, disrupt the compliance solution provider market with new tools, AI and machine learning, and lastly take on challenges in the new world of blockchain technologies.

Where do you see AML technology going in the next 10 years?

10 years ago, when I started out in online payments working on compliance automation, not many fintech companies existed and the regulatory compliance landscape started to really evolve. AML wasn’t really the first thing that came to mind. Most companies either built their own simplistic rule based systems or outsourced to large vendors providing similar AML offers, only more costly and difficult to maintain. Applying more sophisticated techniques was unheard of, especially the larger the company was. 10 years forward, today, AML is everywhere. It’s very real to everybody in the field. Big data combined with machine learning and many open source technologies supporting much easier application of these concepts have allowed many fintech companies to apply the trend in the fraud and compliance space. But it specifically is the compliance domain that just recently got its attention with strong focus on AML/CTF where existing algorithms and new detection concepts are explored. With all the recent global changes to fight cybercrime, protect people’s identities, cyber attacks, and the exploding list of fintech companies, lastly fueled by blockchain technologies and cryptocurrencies, a lot of new opportunities have presented themselves. We are in the middle of a compliance shift from sudden well known techniques against the current financial system to a new world of unknown cryptocurrency solutions that became conflated with the traditional financial system. Although it is difficult to look 10 years ahead, I argue that in order to be successful as a financial organization against AML, you need to adopt to more sophisticated and effective tools and services, offer much more in-depth training to operational staff, further de-risk by helping everyone to benefit from each other through sharing of AML experience, knowledge, and data, and lastly be in a position to quickly adapt to many more coming regulatory changes. Whether it’s sending money or sensitive information across the world, blockchain technologies are here to stay in one way or another. If the industry does not adopt and catch up, the bad guys will. And as we all know, they always take the least path of resistance which is plentiful with today’s abilities to fund and transfer funds online. Depending where this route leads us, many new solutions will emerge. Ultimately, there is so much untapped technical opportunity that needs to be turned into usable and powerful counter solutions. That’s exactly what we are doing at Beam. We’re building the next-generation detection engine for fintech, payments, banking, and investment compliance to help our customers stay a step ahead.