Like Meta, banks are responsible for online child sexual exploitation

The online child sexual exploitation (CSE) model has shifted. What used to take place in faraway lands is now also happening down the street.  

Westerners are increasingly selling sexually suggestive images of their children on social media for financial gain.  

“Parent-owned minor accounts,” which bypass Meta’s age-restriction policies, offer exclusive content and interactions with minors, often in the pursuit of online fame. Many of the buyers have an open sexual interest in children.  

Both the New York Times and Wall Street Journal have run articles investigating the topic recently. The reports are shocking. 

But while much has been said about Meta’s role – and indeed, it is up to the social media platforms and law enforcement to detect and prevent these crimes from happening – the commentary so far has been missing a principal element.  

 Banks, by facilitating the flow of illicit funds that enable this abuse, also have a responsibility: to detect when these crimes are happening and help to stop predators in their tracks.  

If an offender pays for content, they leave a footprint behind in their financial data. Banks can use this to look for other behaviors relating to online CSE to detect and prevent it from happening. They need to know what to look for.  

CSE: Hiding in plain sight

There are an estimated half a million predators active online each day in the US alone according to the FBI. The increasing use of the internet for schooling and entertainment puts children at an ever-greater risk. 

We know that consumers of online CSE tend to hide their identity with a VPN and other anonymization tools. We also know they make use of pre-paid cards and gift cards to make payments to the facilitators, which are then often converted into cryptocurrencies. Predators send multiple payments on a single day or over consecutive days (sometimes weeks apart) using Western Union, PayPal, and other third-party payment methods; services that omit traditional identification checks.  

In isolation, these behaviors do not ring alarm bells. A VPN, for example, is not an indication of wrongdoing. But if we map the behaviors against online CSE personas, and then cross reference the financial data with the individual’s online activities and sex offender registers, seemingly innocent transactions can start to tell a much darker story. 

It’s through this contextual understanding of the behaviors of online predators that we can unearth where they are hiding. 

Banks can use financial data – the digital footprints of online CSE offenders – to uncover the tracks of people who are abusing, grooming, and victimizing children through their activities on social media and the wider internet. 

A persona-based approach

Project Shadow, Project umbra and the RedFlag Accelerator are some of the initiatives making progress in this space.  

The projects use a persona-based typology methodology, which lists common payment behaviors known as ‘red flags’ relating to Online CSE, to help financial institutions to detect, investigate, and report the potential abuse of children on the internet.  

Banks are provided with a list of typologies for crimes related to human trafficking, modern slavery, and child sexual exploitation. They can look at the crimes holistically or explore specific personas and red flags related to these crimes. For online child sexual exploitation, they’ll find “Payments to a VPN,” “Activity related to cryptocurrency” and “suspicious activity related to gift cards.”  

But they’ll also come across “purchases of childlike sex dolls,” “payments to unrelated minors” and “CSE-related keywords in payment references.” 

Banks can use these red flags to understand if any of their customers are engaged in suspicious activity online. Then, armed with this information, they can start a thorough investigation and begin to collaborate with law enforcement.  

 This persona-based approach allows FIs to spot patterns of behaviors in their financial data in places they would not expect to find them. In its first year, Project UMBRA increased law enforcement referrals from participating FIs sixfold.  

The key to success is in getting this information to the right people within the banks. Anti-financial crime units comb through tens of thousands of accounts each year. Armed with these contextual typologies, they can help to uncover the tracks of crimes that have previously gone undetected. 

Education is the key to spotting patterns of behavior

Online CSE criminals are increasingly utilizing payment systems, as evidenced by money flows either between an offender and a victim (in cases of sextortion or self-production) or between an offender and a facilitator (such as CSE livestreaming or traveling to offend). These transactions are at the core of CSE and can be vital in detecting and stopping these crimes. 

 Banks have a legal obligation to detect, investigate and report financial crimes, including Online CSE. They can do so by working together, sharing information, and educating their anti-financial crimes teams. Persona-based typologies offer a promising step forward.  

As children spend more time online for education, entertainment, and social interaction, they become more vulnerable to exploitation. The fight against online CSE requires a comprehensive approach that addresses both traditional types of exploitation and emerging trends, such as exploitation on social media platforms. Banks can and must do more.

Find out more by downloading our investigation guide.