QuantaVerse Alert Investigator: Compliance Automation To Overcome Resource Shortage During COVID-19 and Beyond

COVID-19 is prompting dramatic shifts in customer behavior as they exponentially increase the use of digital and remote channels for regular purchases and financial transactions. Rapidly evolving crisis situations like this provide fertile ground for financial criminals who take advantage of the uncertainties and vulnerabilities in the system to commit frauds for personal financial gains, and funnel the illicit proceeds into money laundering, terrorism financing, and other nefarious acts. Financial institutions (FIs) must remain vigilant and guard against the elevated financial crime risks at a time when their internal operations are disrupted due to the need for social distancing. Compliance processes at many FIs are not designed to support remote work at a large scale; worse, many parts of compliance operations are not automated, needing significant manual efforts that slow down client onboarding, transaction processing, and cause huge backlogs of cases.

QuantaVerse, a provider of artificial intelligence (AI) powered anti-money laundering (AML) technology solutions, has launched a new adaptation of its QuantaVerse Alert Investigator solution that is intended to automate alert investigation and business continuity for banks impacted by COVID-19. There are two main ways this solution can aid staff-constrained compliance divisions. First, the use of AI automates many steps that compliance professionals would otherwise need to conduct manually to investigate and resolve alerts. This can reduce time and effort needed in the investigation process and enable efficient management of case queues and backlogs. Second, cloud deployment accelerates adoption time and the cloud-based solution facilitates remote work and collaboration among investigation teams. Additionally, cloud deployment optimizes capital and contractual commitment that can be advantageous for banks that are currently operating with a reduced security staff and budget.

Third party vendor due diligence can be challenging for FIs while onboarding new vendors, especially younger fintech companies. Another challenge while adopting AI-driven solutions is testing and validating AI models because they can sometimes be perceived as black boxes with limited explainability. To overcome these challenges and expedite the vendor onboarding process, QuantaVerse provides independent third party model validation documentation and standardized information gathering, as well as an addendum documenting capability and execution steps for business continuity and disaster recovery plans.

The uncertainties and vulnerabilities created by COVID-19 will likely persist for some time, as will the strain due to workforce shortages at FIs. This situation is prompting technology revaluation, modernization, and upgrade in several areas including in financial crime compliance and favoring the adoption of automation and efficiency-enhancing tools. A cloud-based and AI-powered solution such as the QuantaVerse Alert Investigator should therefore be viewed favorably by FIs struggling to meet the challenges created by the pandemic.