Supervisors Symposium

REGTECH/SUPTECH

S upTe c h ( c on t ’d ) No one i s s u g g e s t i ng t h a t A I i s g o i n g t o r ep l a c e huma n j ud gme n t i n conn e c t i on w i t h b a n k a nd f i n a n c i a l s up e r v i s i on . I n f a c t , i t i s j u s t t h e oppo s i t e : t h e r e i s a g r e a t d e a l o f c on f i d en c e i n huma n j ud gme n t d e v e l op e d w i t h ye a r s o f ex p e r i en c e t o eva l u a t e r i s k o f f i n a n c i a l i n s t i t u t i on s . T he r e i s a l s o g r e a t po t e n t i a l f o r A I a nd ma c h i n e l e a r n i n g t o con t r i bu t e t o t h e s up e r v i s o r y p r o c e s s by p e rm i t t i ng a n ex t ra o r d i n a r i l y f a s t r e v i ew o f comp l ex d a t a s e t s a nd t o d e v e l op s c r e en s o f t h e d a t a wh i c h may i d e n t i f y p a t t e r n s o f f i n a n c i a l i r r e g u l a r i t i e s o r o t h e r i mp r op e r condu c t

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REGTECH/SUPTECH

SupTech (cont’d) • On its website, SQL notes other non ‐ U.S. financial regulators beginning to use AI and machine learning processes, including Australian Securities and Investments Commission (“ASIC”). • As noted by SQL: ASIC launched a pilot program in partnership with the Australian RegTech Association to apply cognitive learning tools and applications to accountant web pages to examine potential unlicensed or misleading conduct in relation to self ‐ managed superannuation fund activities.

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