ExigerTech President & UBS Managing Director Co-Author Definitive Compliance Monitoring Treatise Chapter for The General Counsel’s Guide to Government Investigations

The acceleration of technology is changing how organizations define and monitor their compliance standards. Complex data models are growing at an exponential rate alongside heightened regulatory expectations. In light of the inherent uncertainties associated with this new paradigm, is reliance on technology and analytics techniques in BSA/AML compliance a double-edged sword?

“Organizations must adopt a purpose driven approach that embeds their risk mitigation strategies within their technology platforms. No longer can system opaqueness be used as reasonable grounds for compliance gaps. Regulatory expectations mandate that companies understand and ultimately adopt technological and analytics based solutions to mitigate risk.”

Whether manual or automated, compliance monitoring is the analysis of risk-indicative data, generated during business activities, against compliance requirements.  No longer can companies afford to passively respond once a risk event manifests.  Evolving regulatory expectations mandate that the modern company leverage artificial intelligence and technological solutions to actively search for non-compliance.  In the equation of compliance, data, in many forms, is the operand, and policy is the operator. With this in mind, we ask ourselves: what does society’s evolving reliance on technology and analytics techniques mean for the future of GRC? 

Dating back to 1602 with the creation of the Dutch East Indies Company, accommodating for GRC principles is hardly unfamiliar for compliance professionals. The effort to implicate modern mechanisms for managing threats to the lawful and ethical operation has forced us to recognize that the evolution of emerging technologies now presents a double-edge sword. In other words, there are both challenges and benefits of algorithmic decision-making and vast sums of enriched data points generated by financial institutions about people, places and things. The intersection between the amorphous and qualitative measures of compliance – and the increasingly complex and voluminous quantitative variables upon which it may be measured – create an obstacle for most organizations when defining and monitoring compliance standards. Artificial Intelligence systems and machine learning tools, such as DDIQ, are actively being adopted by the industry to help implement the GRC’s mandate that organizations shift compliance from passive to active.  

In conjunction with its Third Annual Conference, the Government Investigations & Civil Litigation Institute (GICLI) recently issued The General Counsel’s Guide to Government Investigations. President, ExigerTech and Global Head of Analytics, Brandon Daniels co-authored, with Wayne Matus of UBS, the definitive chapter on compliance monitoring and the evolution of governance, risk management, and compliance (“GRC”) principles.

Click “Download PDF” below to read Daniels and Matus’ full chapter on Compliance Monitoring. 

 GICLI’s full treatise can be purchased here
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