Use AI to Make Compliance Easy

Although burdensome, every business must ensure its operations and procedures are in compliance with the regulations that have been set for its specific industry.  Artificial intelligence (AI) may be able to lighten the load and make compliance easier for companies and regulators.

The Burden of Compliance

Regulatory agencies are put into place to oversee various industries, such as the healthcare industry, financial industry, entertainment industry, and more. In an effort to protect those who are affected by these industries, the regulatory agencies develop and enforce strict regulations that each company in those industries must follow.  These regulations are also meant to keep the economy growing and thriving.

Regulations are newly created and revised every day, making it extremely challenging and time-consuming for a company to maintain compliance. The difficulties of following constantly changing regulations have caused some organizations to seek technological help, known as regulatory technology, or Regtech.

Regtech’s purpose is to ease the burden of regulatory compliance, making the task more manageable.  There is hope that the duties of the compliance team could one day become fully automated.

For the time being, compliance professionals are still needed, but thanks to AI their job is changing.  Now their training must include machine learning, which enables compliance professionals to carry out their work more efficiently and effectively.

Compliance Department

The desire to automate compliance tasks is understandable, considering how complex and tedious it can be to maintain compliance.

Here is a brief overview of what happens in the compliance department:

  1. Tracking Changes- Maintaining compliance requires keeping an eye out for changes to regulations, which occur frequently. At times, these changes may demand adjustments to company operations in order to remain compliant.
  2. Record-Keeping – Processes must be documented and reported.
  3. Costly – Costs can climb pretty high when attempting to follow regulations and change operations whenever necessary. In addition, an organization may end up paying big time for failing to comply with certain regulations.

Not Easy for Regulators

But don’t think regulators have it easy.  These agencies are required to oversee all entities that belong to the industries they regulate, but keeping track of every organization is no easy task.

They must ensure every organization is compliant by reviewing their documents and processes. If any of those companies fail to comply, the overseeing agency is responsible for carrying out legal action.

How AI Can Help with Compliance

AI technology can assist with compliance, making it much easier for regulators and companies to handle compliance procedures.

Initially, AI’s use for compliance may be limited to helping organizations understand regulations, providing insight into the steps and actions that need to be taken in order to comply.  However, AI may eventually take over the entire compliance process, allowing humans to spend more of their time and energy on other business responsibilities.

Although we haven’t yet seen AI’s full potential for assisting with compliance, here are some of the ways that AI can help right now:

  1. AI Can Work Faster Than a Human – Compliance officers might take hours to read through regulation documents, but AI can get it done in a fraction of the time and provide a simplified summary. This helps the company speed up the compliance process.
  2. AI is More Accurate Than a Human – Because AI can complete compliance procedures more quickly, this technology can review more data than the average person. The ability to review larger amounts of data will reduce instances of overlooked fraud.
  3. AI Updates – AI can consistently check regulations to ensure the company is still compliant. If not, the compliance leaders are notified of any regulation changes.
  4. AI Monitors Compliance – Regulators can use AI to monitor organizations, eliminating the need for audits. Companies can also take advantage of the information that AI finds about their procedures, which will reveal if those companies are compliant. This gives organizations the opportunity to change their operations before they are penalized.
  5. AI Alerts – When necessary, AI will make regulators aware of organizations that aren’t compliant while also documenting the evidence.
  6. AI Spots Duplicates – Some sections of compliance content might be similar to others. AI can quickly spot this so that the compliance team doesn’t waste time reading duplicate content.
  7. AI Automates – Time-consuming tasks can be automated, which frees up more time for regulators to find and address fraud.
  8. AI Saves Money – Automating certain compliance procedures decreases expenses, which is a great benefit that any business or regulatory agency would get excited about.   

By now, it should be obvious that AI can be a very helpful tool for companies and regulatory agencies.  This advanced technology allows businesses to focus on other tasks that lead to growth, instead of getting bogged down by complicated regulations. In addition, AI helps regulators by keeping track of all businesses in the industries they oversee, ensuring they don’t miss or overlook any fraudulent activity.

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