Financial Crime Compliance: AI use for Non Financial Risks
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Financial Crime Compliance: AI use for Non Financial Risks

Celia Pizzi, Brazil Chief Compliance Officer at Travelex Bank
Celia Pizzi, Brazil Chief Compliance Officer at Travelex Bank

Celia Pizzi, Brazil Chief Compliance Officer at Travelex Bank

The use of Artificial Inteligence (AI) for non financial risks monitoring; such as: Regulatory Compliance; Anti Money Laundering (AML); Anti Corruption (ABC);  has been an contínuos improving process, in Latin America and I dare say to the world. The AI; in my opinion; is the way to do it better and with accurace; with no cost increase.

Tools for the Financial Crime Compliance sector use to be seen as an additional cost that doesn´t add value. However that´s clearly untrue. AI allows businesses to scale at speed; taking on a huge amount of new business without scaling up the Compliance team, once with the AI support it is possible to monitor vast quantities of transactions; clients; suppliers; payments; reducing the noise and false positives.

When a company think to use AI solutions for monitoring financial crime it means that  they will stop using binary rules anymore and turn on to use scenarios that combined many factors to understand a specific behavior.

AI’s ability to process vast data sets at a scale no human can do, and to identify patterns and outliers which people cannot see; it creates efficiencies (removing false positives) and more effective outcomes (finds more actual instances of financial crime); move away from a rules-based system which is highly ineffective & inaccurate - removes false positives, reliance on historical information and knowledge, static system, and bias

Ongoing monitoring of clients and transactions is probably the most important part of a financial crime compliance program so the tooling you use is vital.  Don’t bundle in transaction monitoring and screening with other tasks as part of one giant compliance platform.   They are vital components of a financial crime program and you want dedicated state-of-the-art tools.

 AI allows businesses to scale at speed, taking on a huge amount of new business without scaling up the compliance team. Once with AI support, it is possible to monitor vast quantities of transactions, clients, suppliers, payments, reducing the noise, and false positives 

It can be deployed to tackle new products and business areas, allowing companies to expand their range of services and products and feel safe that they´re not taking on new unexpected risks in the process.

AI can be intimidating.  Financial crime professionals are rarely AI or data specialists and may struggle with technological concepts or understanding how AI works.  They’re also busy people who can’t devote much time to assimilating very complex new topics, but it is a kind of investiment that we need to believe and put efforts to move for this technology.

Another important question that always comes together is about the acceptance of use the  AI by regulators.

Acctualy there is plenty of support for greater use of technology and the use of AI in compliance.  FATF have indicated they are supportive, and many  regulators who have commented on it have also indicated they think it can be a very powerful tool with major benefits.  Of course it is still new territory, but overall I don´t believe regulators are resistant or too conservative regarding AI solutions. An important point here is the obtained results explainability.  It is important for AI users to be able to explain how a tool works - at the appropriate level of detail for a regulator or business partner.  An AI tool can’t be a black box which generates outputs no one can understand or challenge, or assess, therefore I think this is the best way we have nowadays to work on preventing financial crimes.

Celia Pizzi, Certified Anti Money Laundering Specialist (CAMS)

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