AI systems that can detect financial crimes have expanded, and financial institutions (FIs) that aren’t up to speed can find there’s an urgency both internally and externally to step up efforts to get the right tech in-house, The Wall Street Journal reported Wednesday (July 20).
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“You don’t want to be lagging behind, because that puts you in the spotlight,” Alma Angotti, a former senior enforcer with the U.S. Treasury Department’s Financial Crimes Enforcement Network, told the Journal.
Angotti, now a partner at the consultancy firm Guidehouse, added that eventually, boosting technology to meet compliance will be a “regulatory expectation” and pointed to the Biden administration’s prompting to get companies to catch up.
Tech solutions powered by AI have been developed to make compliance tasks less manual and laborious while easing the burden on compliance departments. The tools can make it easier to quickly spot criminal activity among legitimate transactions.
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“There are billions and billions of dollars being spent in compliance in big financial institutions, which could be automated out,” said Greg Watson, chief operating officer at Napier Technologies.
Advocates of AI have said the technology can meet compliance requirements more efficiently with less staff, while also offering ongoing audits of transactions for money-laundering flags and sanctions offenses, the report noted.
Related: FIs Need Collaboration AND Technology to Win AML War
Businesses that make the effort to stay on top of the latest AI and automated technologies could also be seen by regulators in a more favorable light, Seth DuCharme, a former senior official in the U.S. Justice Department, told the Journal.
