Using AI to achieve compliance and drive governance

Every industry – from legal to finance to healthcare – is supervised by either a single regulator or a group of regulators.

For instance, the financial industry in the US is regulated by the U.S. Securities and Exchange Commission, Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corp and others. Each of these bodies has thousands of regulatory obligations that financial firms have to comply with day in, day out. This means that organisations are under the lens continuously, and there is no escape from compliance standards.

With the rise of new technologies such as instant payments and blockchain regulations are constantly evolving to ensure financial stability. Keeping track of these changing compliance requirements is both a time- and resource-consuming exercise for every organisation. In addition, failure to comply with the regulations may expose organisations to hefty fines, criminal charges, and, in extreme cases, loss of licenses.

These problems have led organisations to explore disruptive technologies such as Regulatory Technology (RegTech) and Artificial Intelligence (AI) to ease the burden of tracking the innumerable regulations by various supervisory bodies. These technologies help organisations manage changing regulations effectively and efficiently by automating certain aspects of data gathering and validation.

AI to the rescue

AI, in particular, has been extremely advantageous in terms of helping companies keep up with changing regulations. AI and machine learning (ML) tools  can process huge chunks of data with the utmost speed and accuracy, thus assisting organisations interpret compliance requirements and take relevant action.

The following diagram depicts the role of AI in compliance:

 

role of AI in compliance

Monitoring and gathering regulatory updates: AI systems use deep learning and natural language processing to navigate through regulatory websites, news articles, and unstructured data for any regulatory updates. Gathering data involves a “confidence score”, which determines the probability of the data being statistically correct and is derived in the process of training the AI system to recognize certain patterns

Notifying the compliance officers: After data gathering, the AI system notifies compliance officers of any regulatory updates to ensure that organisations stay on top of evolving regulations and align their processes to meet compliance requirements.

Interpreting the regulations to provide actionable insights: Compliance officers have to read a lot of documents thoroughly to interpret regulations. However, they do not have much time to read the documents and keep track of the changes in them. AI applications can interpret these regulations and provide compliance officers with concise, easy-to-read documents consisting of the most relevant portions of the regulations. This allows the compliance officers to take quick action to ensure compliance with emerging regulations.

How Cenza can help

Cenza has considerable experience in training AI systems and is certified by leading AI providers such as Kira Systems and Leverton. Our deep level expertise in ML helps our AI provider partners to streamline processes and lower the cost of adopting advanced RegTech technology.

AI providers partner with Cenza because:

  • We have invaluable hands-on ML experience and are certified in two of the leading ML systems.
  • We stay up-to-date on the latest technology and incorporate these solutions and platforms into projects.
  • We can rapidly assemble teams to train systems for simple or complex judgments.
  • We have access to the right expertise through our network of compliance subject matter experts.
  • We are cost-effective in terms of scaling up and timely in our delivery.
Andrew Jardine

Andrew Jardine

Andrew provides advice to Cenza and their clients on how best to utilise legal services in conjunction with different legal technologies, achieving high quality and cost effective solutions. Andrew does this by leveraging his legal technology and strategy consulting experience gained during his time as an early stage employee at Kira Systems and while as a Consultant at Deloitte earlier in his career. In hisspare time Andrew publishes a legal technology podcast, “Legaltech Tapas”, helping people to stay informed about different legal softwares.