In today’s ever changing and AI dominant world, there’s one role that is not replaceable by robots/Artificial intelligence; the Compliance Officer. The main reason is that each case is unique, a lot of thought processes and investigation goes into developing the final solution on how to handle a compliance issue.
Two years ago, HSBC Holdings PLC had an incident in which a front-line employee had become suspicious of a transaction request to transfer $2 million, it was subsequently rejected by staff and raised as a suspicious transaction for investigation. This led to uncovering a $500 million money laundering scam.
Fast forward two years and such activities have not shown any signs of slowing down, so far $2 trillion has been discovered in the money laundering pipeline. At the very least, 5 to 6 European banks have found themselves in the midst, being investigated and connected to large money laundering schemes. Denmark’s Danske Bank A/S, Deutsche Bank AG, and other prominent banks are involved.
Thus, instead of decreasing human power and going fully or mostly AI dependant, the banks have increased the employment rate within the compliance departments and are using a great deal of funds towards the battle against money laundering.
The problem with fully relying on AI to tackle money laundering is that there is no perfect algorithm to completely stopping the activities. The system will only follow the patterns presented to it from historical data, where as an individual would tackle head on with possible realistic solutions. There is limited KYC available to systems as each jurisdiction has its own rules and regulations.
In Europe due to the current European union agreement many individuals can freely travel between countries and move funds as they wish between banks. If all the European banks decided to come together and share the data, they possess. If all banks across Europe had similar rules and regulations it would make it much harder for launderers to move funds around.
Until the solution to AI taking over the compliance officer role is perfected, the living and breathing human performing the role of compliance officer will continue.