4 Ways How AI Can Help Financial Services Compliance and Risk in the Future

Artificial intelligence (AI) has been embedded in many aspects of business, public life, and politics in recent years. However, as AI becomes more common in people's lives. AI is becoming increasingly relevant in regulatory compliance as it addresses typical operations obstacles and systemic concerns that regulators confront on a daily basis, in addition to upgrading data management practices by employing cloud-based technology. Alert Transparency capabilities, use artificial intelligence (AI), Natural Language Processing, and other backend technologies to provide compliance alerts and triggers. Questions have arisen about how AI can help financial services compliance and risk in the future, read these points to solve this question.

Management of Regulatory Change

To successfully handle regulatory change management, Financial services have to combine the content of thousands of regulatory papers. Regulatory changes need changes that require collaboration among many business units and have second-and third-order consequences.

Reducing False Positives

Financial institutions facing large volumes of false positives as a result of their traditional rule-based compliance alert systems. Something is broken with legacy compliance processes, according to Forbes, with false-positive rates often topping 90%. AI-Driven Alert Transparency gives financial institutions detailed information about why an alert was issued, allowing them to spot potential market manipulations, which have become increasingly common in today's hybrid work-from-home environment.

Prevention from the Fraud

The use of artificial intelligence (AI) to combat fraud is already widespread – and will only grow in the future. AI can track the transaction history, combined with other structured and unstructured information, to identify ATM hacking, money laundering, lending fraud, cyberattacks, and terrorism financing. Shield Alert Transparency is a full Workplace intelligence platform that helps to identify numerous hazards across communication channels, such as insider trading, spoofing, front-running, and even sexual harassment and racism.

Minimizing Human Errors

Every year, human errors cost billions of dollars to regulated industries. For instance, in 2020, Citigroup's credit department made a clerical error that resulted in over $1 billion being paid to Revlon Inc.'s lenders. Ineffective methods, outmoded technologies, and neglect to name a few, are all sources of human mistakes in asset management.

Sheild believes there is a better way to stay compliant and understand the daily struggles of the compliance team, from top to bottom. If you want to know more about Shield Alert Transparency you can visit Shield's website.