Compliance and governance


Compliance risks have become a...


Compliance risks have become a major threat for the bankers in the U.S.

Compliance risks have become a major threat for the bankers in the U.S.
The Silicon Review
31 January, 2020

Recently in the U.S., sanctions enforcers are levying heavy fines on banks. The highest fine which was levied on an institution was $8.9 billion and in 2014 BNP Paribas agreed to pay it. In 2019 Standard Chartered paid a whopping $1.1bn because it violated the sanctions. Société Générale agreed to pay $1.3 billion to the US authorities to resolve an investigation against them. Last year UniCredit agreed for a settlement of $1.3 billion for violating multiple sanctions. Regulations are on rise and bankers are frantically searching for a solution to automate their systems to comply with the sanctions.

Baker McKenzie, a partner at a law firm stated that the banks are turning to artificial intelligence to help them manage their compliance risk and sanctions. One of the significant problems in deploying a solution is that it is hard to identify potential clients, company or an individual who will be subject to the sanctions restrictions. By continuously reviewing the processes and infrastructure the technology can help in improving the compliance and efficiency costs. Even after deploying the technology, it cannot completely mitigate the cost and risk factors. Trade lawyers and Bankers have a suggestion in which the regulators could give them a path instead of just staying neutral. UK finance is anticipating that the British will introduce an information-sharing power that will allow all the players in the sector to share info in a secure ecosystem.