Supervisors Symposium

REGTECH/SUPTECH

SupTech (cont’d) SQL also references a 2017 UK regulatory development with the Financial Conduct Authority (“FCA”), which announced it is looking into possible uses of AI and supervised machine learning to enforce regulatory compliance from analytics and detect financial irregularities. ● This provides additional support for the idea of using AI and machine learning to detect patterns that may be more apparent from a computer assisted scrub of data than would be apparent to a person reviewing the same data set.

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B A N K S A N D A R T I F I C I A L I N T E L L I G E N C E

Why do Bank Regulators Need to Concern Themselves with AI Matters?

● An investment by a bank in AI to improve its risk profile to deter and fraud and effectiveness in using the technology ought to be a positive factor in evaluating the strength of management at the bank. ● AI is expected to be able to recognize patterns of suspicious activity in the AML area better and faster than human analysis of the same data. ● AI tools and technology can help banks and bank regulators combat “false positives” presented in the data reviewed, including AML matters, and to do so in a manner that helps to “clean up/scrub” the data base and maintain its integrity.

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