AIArtificial Intelligence
Artificial intelligence (AI) is the use of computer systems to perform tasks that normally require human intelligence, such as recognizing patterns, making predictions and generating language. In compliance, AI is applied to anomaly detection, transaction monitoring, sanctions and name screening, customer risk scoring and alert investigation. Unlike rule-based systems, AI can detect patterns and networks of suspicious behavior that fall outside pre-programmed scenarios.
Why it matters
Rules and thresholds remain the backbone of many monitoring programs, but they generate large volumes of false positives and only catch the typologies someone thought to write down. Machine learning models learn what normal behavior looks like for a customer or peer group and flag deviations, and network analytics can reveal links between accounts that no single rule would connect.
Regulators support responsible innovation but expect governance. Models must be explainable to investigators and examiners, validated, monitored for drift and bias, and documented under model risk management standards. Generative AI and AI agents are now used to gather evidence, summarize cases and draft narratives, with a human investigator making the final decision.
The EU AI Act, Regulation (EU) 2024/1689, entered into force in August 2024. It classifies AI used to assess the creditworthiness of individuals as high-risk, with an exception for systems used to detect financial fraud. Following a 2026 amendment, obligations for the high-risk systems listed in Annex III apply from December 2027.
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