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To Maximize Artificial Intelligence’s Value, We Have to Let It Do Its Thing. What Could Possibly Go Wrong?

There is no question that artificial intelligence is a vital and growing topic that many businesses are looking at and implementing. From evaluating potential business deals to defending networks...

November 23, 2022 | By Alan Brill


Risk and Compliance Disruptors: Innovative Startups Specialize in Automation and Acceleration

Disrupt. Innovate. Accelerate. These are activities far more likely to be associated with technology and innovation than with risk management and compliance – except where entrepreneurs are shaking...

November 4, 2022 | By Katherine Heires


How to Avoid the Risk Mechanic Syndrome in Machine Learning

Machine learning (ML) is one of today’s hottest topics within the financial services modeling community. This technology holds great promise to expand credit availability, reduce losses and increase...

November 4, 2022 | By Clifford Rossi


Coinbase’s Institutional Flip Side

Shareholders of Coinbase Global are paying a steep price. The stock has been down over 70% this year as the cryptocurrency exchange – the biggest in the U.S. – contends not only with uncertainties...

October 28, 2022 | By David Weldon


Wall Street Warms to Tokenization

Settlement delays are costly enough to concentrate the minds of the financial markets’ biggest institutions and infrastructure operators. Depository Trust & Clearing Corp. (DTCC) is leading an effort...

October 28, 2022 | By Michael Shari


The Risk Matrix Approach: Strengths and Limitations

One of the key tasks of the financial risk manager, as one on my colleagues eloquently put it, is to “help people to worry more intelligently.” In part, the risk management field addresses our...

October 7, 2022 | By Cristian deRitis


As Crypto Winter Lingers, Digital Custodians Fill Senior Posts

The job cuts ascribed to the downturn known as crypto winter have spread to some of the cryptocurrency industry’s most high-profile and at times polarizing personalities. Among those resigning: Chief...

October 7, 2022 | By Jeffrey Kutler


Beyond Deepfakes: Synthetic Fraud’s Next Alarming Evolution

“Deepfakes,” near-perfect but synthetic still images or video footage created with the intention of impersonating an individual’s identity, have gained recent notoriety. They are a type of synthetic...

September 30, 2022 | By Martin Rehak


The Ethereum Merge: A Smoother On-Ramp for Institutional Finance?

The hype surrounding a major upgrade of the Ethereum blockchain had been building for years, but mainly among crypto-market enthusiasts who worked on it or understood the technicalities. Closer to –...

September 23, 2022 | By Jeffrey Kutler


The ‘Rebranded’ Mission for Legal Entity Identifiers

The Global Legal Entity Identifier Foundation (GLEIF) has announced a rebranding of its mission – from identifying financial market participants exclusively, to identifying participants in digital...

September 9, 2022 | By Allan D. Grody


Fintech Innovation: What Does it Mean for FRMs?

Fintechs are among the world’s most innovative companies. Innovation is moving so fast, in fact, that financial regulators are having trouble keeping up – but what are the risks of this disruptive...

September 9, 2022 | By Tod Ginnis


The Rise of Low Code: A Productivity Breakthrough with Caution Flags

Financial firms pursuing digital transformation are adopting low-code software, a powerful method of simplifying and accelerating system development. But as with other information technology...

September 2, 2022 | By Katherine Heires


Financial Infrastructure at a Systemic Crossroads

Between cloud migration, the COVID-19 pandemic, and nation-state cybercrime, risk management principles and practices have changed dramatically in a few short years. Headlines blare “Breach!” and...

August 19, 2022 | By Jeff Mezger


Will the ‘Systemically Important’ Club Become Less Exclusive?

The “systemically important” label, attached to an elite group of banks as a result of post-financial-crisis regulatory reforms, may soon be applicable to U.S. critical-infrastructure industries in...

August 19, 2022 | By Jeffrey Kutler


Data Regulations Follow – and Go Beyond – Europe’s GDPR

New battles are flaring up around data privacy and portability. The issues that came to the fore in Europe’s landmark General Data Protection Regulation (GDPR) and influenced similar laws elsewhere...

August 12, 2022 | By John Hintze


Machine Learning and Risk Management: A Q&A with Professor John Hull

Machine-learning (ML) models have become increasingly prominent within financial services firms, and their adoption is unlikely to slow anytime soon. What does this mean for the employment prospects...

August 5, 2022 | By Tod Ginnis


Embedded Applications: New Revenue and New Risks for Banks

To embed or not to embed? That has become a question for a growing number of banks as opportunities and risks arise from embedded banking, or integration of payments, credit and other banking...

July 22, 2022 | By Katherine Heires


The Risk-Reducing Stages of Alternative Data Implementation

There are throngs of varying types and sources of alternative data. Unlike traditional models – those made available by financial exchanges and indexes, SEC filings, financial statements, corporate...

July 15, 2022 | By Julia Valentine


U.S. Seeks Expert Insights on Artificial Intelligence

Although artificial intelligence has been evolving and gaining commercial acceptance for decades, it is advancing at such a pace as to confound efforts to fully grasp its business, economic and...

July 15, 2022 | By David Weldon


Avoiding the Model Myopia Trap

Today, we find our profession at a critical inflection point with the rise of “Big Data” and artificial intelligence applications. Indeed, thanks primarily to advances in computer software and...

July 15, 2022 | By Clifford Rossi


Will Legal Entity Identifiers Get a Legislative Boost?

The 2008 Lehman Brothers bankruptcy and the global crisis that it triggered may be fading into history, but the financial world is still working to fix the data management debacle that the Lehman...

June 17, 2022 | By John Hintze


How to Improve Cyber Resilience: A Q&A with the OCC’s Patrick Kelly

As ransomware and other destructive cyberattacks continue to inflict major losses, and as banks move toward digitization and a rising reliance on third-party suppliers, the exposure of the financial...

June 10, 2022 | By Christopher Hetner


The Next Frontier in Risk Management: How to Achieve Digitalization

The digitalization of businesses has the potential to unlock new opportunities for increased profitability and reduced risk. However, to reap the rewards of this transition, firms need to take a...

April 29, 2022 | By Alla Gil


The Rise of the Metaverse: A Brave New World for Risk Managers?

Metaverse is one of the hottest buzzwords in technology. Given its potential impact on financial services firms, it’s a good idea to examine this new digital reality and to consider what it might...

April 15, 2022 | By Tod Ginnis


The Ukraine Crisis Puts the Focus on Crypto

The invasion of the Ukraine by the Russian army was a sharp reminder that the world does not let us pause and recover from one crisis before delivering another; it would seem that, unfortunately,...

April 8, 2022 | By Peter Horne


The Cyber Hiring Gap: What Does It Mean for Financial Risk Managers?

Financial institutions have steadily increased their reliance on technology in recent years, a trend accelerated by the pandemic and the spike in remote work. As this digital dependence increases,...

April 1, 2022 | By Tod Ginnis


Artificial Intelligence and Machine Learning Grow in Financial Services – with Caveats

For Ibrahim Dusi, chief risk officer for the Americas at Revolut, artificial intelligence and machine learning “are an important tool in our toolkit” for fighting fraud or identifying bad actors....

March 25, 2022 | By Katherine Heires


Open Banking Gets a Nudge from Washington

The U.S. lags other countries in open banking, the practice of enabling the sharing of customer account information between banks and third-party service providers. A White House executive order...

March 4, 2022 | By John Hintze


Dissecting Modern Cyber Security: A Q&A with Erez Liebermann

In response a surge in cyber crime and a shift toward digitization in financial services, regulators are now turning up the heat on buy-side institutions, forcing management teams reconsider their...

February 25, 2022 | By Christopher Hetner


Banks Eye More Efficient Payments with Less Risk, but There Are Hurdles Along the Way

Banks are facing a November 2022 deadline to be able to receive cross-border payments in a new, data-rich messaging format. It is a step in the global migration to the ISO 20022 standard, which...

February 25, 2022 | By John Hintze


The Impact of Technological Advancements on Risk Managers

Today, financial institutions are using artificial intelligence (AI) and machine learning (ML) for everything from credit underwriting to fraud detection and anti-money laundering. It seems...

February 18, 2022 | By Tod Ginnis


The Cybersecurity Playbook for 2022 and Beyond

After two years of battling the coronavirus, many health experts believe the crisis will recede only when COVID-19 becomes endemic. In other words, we can’t eliminate the virus, but we can hope to...

February 11, 2022 | By Paul Mee


Road to Net Zero: Using Data and Analytics for Portfolio Intelligence

Discussions around climate change and climate risk gained significant momentum in the past year, particularly in the lead-up to COP26, the United Nations’ climate change conference in November. As...

February 4, 2022 | By Peter Plochan


Blockchain Shows Promise in Securitization

Even as distributed ledger technology shows that it can deliver efficiency and risk management benefits in structured finance, the vision of a fully digital marketplace has been slow to take shape....

January 28, 2022 | By John Hintze


How to Measure and Manage Cyber Risk: A Quantitative Approach

Over the past year, cyber risk has grown, hand-in-hand, with the digital transformation of the financial services industry. As cloud computing and distributed transactional capabilities have been...

January 28, 2022 | By Christopher Hetner


University of Maryland Professor Wins Annual Quantitative Finance Award

The International Association for Quantitative Finance and Northfield Information Services have announced Dilip B. Madan as the 2021 IAQF/Northfield Financial Engineer of the Year (FEOY). The award...

January 7, 2022 | By Jeffrey Kutler


Determining the Price of Model Interpretability

How do machine-learning (ML) models stack up against more traditional credit risk approaches? Just a few weeks ago, the EBA released a discussion paper on the use of ML techniques for the calculation...

January 7, 2022 | By Tony Hughes


Former Financial Regulators Dive Deeper into Crypto

A boom year in cryptocurrency trading and digital-asset development is nearing an end, and there is no let-up in the market’s allure for ex-regulators embracing both pro-innovation and...

December 17, 2021 | By Jeffrey Kutler


Ransomware: Don’t Expect Governments Alone to Save Us

Did you hear about the latest major cybersecurity breach that disabled a public company? “Which one?” you ask.  Take your pick. Cyberattacks are the new weapons of mass destruction for businesses,...

December 17, 2021 | By David X Martin


The Rise of Machine Learning in IRB Models: New EBA Outlook Could Open Door

Until now, European banks have been hesitant to apply machine learning (ML) to their internal-ratings-based (IRB) models for credit risk. The supervisory requirements they had to meet to ensure they...

December 10, 2021 | By Marco Folpmers


Cyber Disclosures: New Regulation on the Horizon

Amid a global surge in cyberattacks, the U.S. Securities and Exchange Commission (SEC) is expected to soon release a rule proposal aimed at providing investors with increased cyber-risk transparency....

December 10, 2021 | By Christopher Hetner and Lisa Quateman


The Future of Real Estate Machine Learning: Risks and Opportunities

Financial risk managers must assess a broad spectrum of threats, including the liquidity risks connected to substantial real estate investments. For many reasons, it’s hard to build valuation models...

November 24, 2021 | By Tony Hughes


The Alternative Data Craze: Peering Behind the Curtain

Amid the pandemic, traditional data has failed to provide the timely insights required for drastically-changing behavioral patterns. That's one of the reasons why alternative data has seen...

October 22, 2021 | By Alla Gil


Cyber Risk Trends in the Boardroom: A Q&A with Marija Kramer

Ramping up its focus on cybersecurity disclosures, the SEC recently upped the ante on financial institutions' management of cyber risk. Following enforcement actions against eight financial services...

October 15, 2021 | By Christopher Hetner


ESG Provides Impetus to Drive Front-Office Performance

Half a century ago, Nobel laureate economist Milton Friedman called corporate social responsibility “hypocritical window dressing,” saying executives who prioritized anything but profits “reveal a...

October 8, 2021 | By Elaine Chim


The Evolution and Promise of Frictionless Payments

Editor's Note: Technology has been streamlining and accelerating commerce for decades, but the supporting payment systems have not quite kept pace. Efforts in the U.S. to implement real-time...

October 1, 2021 | By Ed Whitehead


Attacking Cryptocurrency Theft: Transaction Databases and Analytics Have Criminals on the Run

A new reality is hitting home with cryptocurrency criminals and changing this category of cyber risk for the better: It has become more difficult to get away with illicit transactions and hold onto...

September 10, 2021 | By Katherine Heires


Credit-Risk Models Based on Machine Learning: A 'Middle-of-the-Road' Solution

Financial institutions are using machine-learning-driven models for everything from anti-money laundering to fraud protection. However, while ML models have undoubtedly yielded gains in these areas,...

September 10, 2021 | By Marco Folpmers and Linda Torn


The Path Toward Cyber Resiliency: A Q&A with CrowdStrike's Shawn Henry

Global cybercrime damages are projected to reach $6 trillion this year, and nation-state adversaries are increasingly leveraging widely-used software suppliers to gain access to networks. The threat...

September 10, 2021 | By Christopher Hetner


Executive Moves: Heavy Traffic on Cryptocurrency's Bumpy Road

The price of bitcoin can be wildly volatile. Cryptocurrency exchanges have been hacked and suffered outages. Some of those organizations hopscotch around the world to minimize regulatory oversight;...

September 3, 2021 | By Jeffrey Kutler


Digital Currencies: Risks and Opportunities

The financial services landscape may eventually be altered, significantly, by digital assets like cryptocurrencies and central bank digital currencies (CBDCs). Banks must therefore be prepared, not...

September 3, 2021 | By Cristian deRitis


Cyber Risk Economics: Building Exposure Into ERM

Mounting financial losses due to cyberattacks have business leaders scrambling for answers and cyber insurance carriers searching for cost-effective solutions. Damages from cybercrime are projected...

August 26, 2021 | By Christopher Hetner


Systemic Cyber Risk Reduction: A Q&A with the Department of Homeland Security’s Bob Kolasky

Fueled in part by high-profile ransomware attacks that have resulted in major losses, cybersecurity is now a top priority at just about every type of business - including financial services firms....

August 26, 2021 | By Christopher Hetner


Drowning in Data? Strengthen Finance's Relationships with Data and IT

We've all been in situations where people use quality of data as a smokescreen to avoid the real business conversation at hand. It's a natural human reflex that causes an insane amount of...

August 20, 2021 | By Adam Meister


Anti-Fraud Technologies Rise to the Occasion

Remote work and the technologies enabling it boomed during the pandemic, and fraudsters got busy - exploiting network vulnerabilities, collecting personal and business data, conducting social...

August 6, 2021 | By Katherine Heires


Consensus Begets Competition in Digital-Asset Infrastructure

Like other leading market operators - and the investment community they serve - Deutsche BÖrse Group has been watching the emergence of crypto assets and setting strategy for jumping into the fray....

July 30, 2021 | By Jeffrey Kutler


Systemic Cyber Risk Reduction: A Q&A with the Department of Homeland Security's Bob Kolasky

Fueled in part by high-profile ransomware attacks that have resulted in major losses, cybersecurity is now a top priority at just about every type of business - including financial services firms....

July 30, 2021 | By Christopher Hetner


Racing with Wall Street's Robots

The biggest names and deepest pockets on Wall Street do not have the high-frequency trading (HFT) technology arms race to themselves. Serial trading tech entrepreneur George Kledaras is touting a...

July 2, 2021 | By Michael Shari


Cyber Risk Economics: Building Exposure Into ERM

Mounting financial losses due to cyberattacks have business leaders scrambling for answers and cyber insurance carriers searching for cost-effective solutions. Damages from cybercrime are projected...

June 25, 2021 | By Christopher Hetner


Faster Payments Pick Up Momentum in the U.S

Faster payment initiatives in the U.S. are catching up to and could surpass networks that got an earlier start in other countries. The Federal Reserve's pending FedNow Service promises to widen the...

June 25, 2021 | By John Hintze


How to Mine Synthetic Data: Pros and Cons of a Shiny New Tool for Risk Managers

In a post-pandemic world where historical data has been so clearly found wanting, it should come as no surprise that synthetic data approaches are sprouting like mushrooms after a rainstorm. In the...

June 18, 2021 | By Alla Gil


New Computing Architectures Meet 'Interest Rate Risk in the Banking Book'

Although Interest Rate Risk in the Banking Book (IRRBB) is not a new topic, there are very few discussions and publications about the technical challenges that many banks still face. Regulators have...

June 11, 2021 | By Patrick Hauf and Stefan Trummer


The Complexities of Modern Risk Forecasting: Anticipating the Anticipation Economy

What do Carly Simon's 1971 hit single and Amazon's 2013 patent for forecasting product demand have in common? They both focus on the concept of anticipation. As data and models permit faster, more...

June 4, 2021 | By Cristian deRitis and Laurent Birade


Network Analysis: How to Mitigate Unexpected Risk

Some of us hate it, others love it, but at least we can all agree that networking is a very important business skill. The ability to accumulate connections that provide relevant business information...

May 28, 2021 | By Peter Went


Risk Drivers and Revenue Forecasting: A Brave New World

Every investor who's ever read the small print knows that past performance doesn't indicate future performance. Today, in a world in which the relationship between established drivers and revenue has...

May 21, 2021 | By Alla Gil


3 Model Risk Management Lessons from COVID-19

Amid the pandemic, as banks rapidly transformed their core businesses to serve their customers, the digitization of banking has given rise to new model risk management challenges. Decision-making has...

April 30, 2021 | By Peter Went


Natural Language Processing Sharpens Its Focus on Financial Risk

Advances in natural language processing (NLP), a form of artificial intelligence that companies like Facebook and Google have applied in online search and voice recognition, are helping to accelerate...

April 23, 2021 | By Katherine Heires


Crypto Risk Governance: Hazards and Opportunities

The crypto world is exploding in financial value and investment dollars. A Bitcoin now trades at more than $60,000 in a trillion-dollar market, while non-fungible tokens (NFTs) sell for millions. But...

April 16, 2021 | By Brenda Boultwood


For Ex-Regulators, the Door Revolves Toward Tech

If career moves by former regulators are signs of the times, then J. Christopher Giancarlo could be the contemporary archetype. His first major announcement, after stepping down in 2019 from the...

April 9, 2021 | By Jeffrey Kutler


7 Unique Challenges in Cryptocurrency Risk Management

Cryptocurrencies have long been heralded as the future of finance, but it wasn't until 2020 that traditionally conservative and risk-averse institutions became proactive investors in this complicated...

March 19, 2021 | By Peter Went


Synthetic Data's New Wave

Data has come to be known as “the new oil,” and as with motor oil, data comes in synthetic forms. Longtime risk manager Aaron Brown recalls pioneering work in the 1980s and '90s, “except we didn't...

March 12, 2021 | By Katherine Heires


4 Risk Management Guidelines for Fintechs

The financial services industry is becoming rapidly transformed by the shift toward online banking products and services, where models driven by artificial intelligence (AI) have risen to prominence....

February 19, 2021 | By Peter Went


Paul Glasserman Named IAQF/Northfield Financial Engineer of the Year

Paul Glasserman of Columbia University has won the 2020 IAQF/Northfield Financial Engineer of the Year (FEOY) award. The announcement was made February 8, but the customary annual dinner presentation...

February 19, 2021 | By Jeffrey Kutler


Tempered Expectations: The Hope and Reality of AI in Risk Management

A couple of years ago, risk professionals had great expectations about artificial intelligence (AI). But the expected paradigm shift hasn't yet occurred - at least not for probability of default (PD)...

February 12, 2021 | By Marco Folpmers


Securitize Inc.: Full-Service, Regulated, and 'Reinventing Private Capital Markets'

The still unfolding saga of Bitcoin and other cryptocurrencies, while rife with speculation and skepticism, has given rise to a dynamic and growing class of digital asset products and entrepreneurial...

January 22, 2021 | By Jeffrey Kutler


Model Risk Management and the AI Effect

While artificial intelligence brings fundamental changes to quantitative and analytical modeling, risk managers are having to update and adjust their work processes to keep pace with the...

January 15, 2021 | By Katherine Heires


Stemming the Tide: How to Identify and Mitigate Pandemic-Era Cyber Threats

COVID-19 has set structural and technological changes in motion, creating new cyber risk and security challenges that will likely endure even after the pandemic ends. There is no shortage of...

January 15, 2021 | By Christopher Hetner


At Pandemic Year's End, a Severe Cyber Strike

A “cyber Pearl Harbor” scenario has haunted the technology world since then-U.S. Defense Secretary Leon Panetta presented it in 2012. The massive SolarWinds breach that came to light in December 2020...

January 8, 2021 | By Jeffrey Kutler


How Artificial Intelligence Will Change Qualitative Risk Management

The earth is trembling below the feet of the chief risk officer, who is now facing huge risk assessment and risk integration challenges. While there are no simple solutions, artificial intelligence...

December 18, 2020 | By Brenda Boultwood


The State of Fintechs: Trends, Risks, and Opportunities

The end of the year is an opportune time to assess the risk management implications of three evolutionary trends that defined 2020 for fintechs: the increased commercialization of artificial...

December 18, 2020 | By Peter Went


Regulators Are Off to the (Tech) Races

Speed and competition are hallmarks of high-tech culture. The financial industry has sought to infuse these values into its fintech initiatives, and the regulatory community is following suit. As...

November 25, 2020 | By Jeffrey Kutler


How Artificial Intelligence Will Change the Way We Manage Compliance

Ahead of the recent U.S. presidential election, regulators doled out billions of dollars in penalties to several large banks, shining a clear spotlight on risk management and compliance failures. It...

November 13, 2020 | By Brenda Boultwood


COVID-19 Lessons Learned: Nonbinary Risk and the Power of Organization

The rhetoric around the coronavirus pandemic has been intense, creating tension, confusion, and even violence over the right way to handle this crisis. Some have argued that locking down the economy...

November 6, 2020 | By Cristian deRitis


Cyber Volatility: How Regulators and Banks Are Responding to a Surge in Cybercrime

Every year, cybercrime becomes cheaper, easier, and faster, making a variety of companies - including banks - more vulnerable to attacks than ever before. Damages from cybercrime are projected to...

November 6, 2020 | By Christopher Hetner


Risks and Digital Transformation in the New Normal

Earlier this year, in just a few weeks, COVID-19 forced greater adoption of innovative technologies and accelerated a worldwide digital transformation. In financial services, operating models and...

October 23, 2020 | By Peter Went


A Faraway (for Most) Cyber Attack Renews Financial Market Concerns

Operationally speaking, 2020 has been a banner year for exchanges and financial market infrastructures. The World Federation of Exchanges (WFE) said value and volume traded worldwide set records in...

October 16, 2020 | By Jeffrey Kutler


Operational Resiliency Must Remain a Top Priority

As a vast majority of the financial industry's workforce continues working remotely, organizations are operating in entirely new ways. No one could have predicted at the end of last year that a...

October 9, 2020 | By Dan Thieke


Fragmented ABS Market Turns to Blockchain for Structure

In an effort to address the types of inefficiencies in the securitization market that helped fuel the subprime mortgage crisis, a pair of large financial services firms are now employing blockchain -...

October 2, 2020 | By John Hintze


Accelerating Digitization Exposes Persisting Weaknesses in Identity Protections

The much touted digital transformation of business, finance and the economy is well underway, judging by how readily people and organizations adjusted to new working and distancing conditions...

September 25, 2020 | By Katherine Heires


XBTO: A 'Micro Ecosystem' Takes the Measure of Cryptofinance

The original cryptocurrency, Bitcoin, and its blockchain ledger are more than a decade old. Yet even as established institutions have deliberately made their way into the asset class and tested the...

August 28, 2020 | By Jeffrey Kutler


Risk and AI Are Common Themes in Fintech Lab Innovations

Technology pilots are underway at major financial firms this summer that are monitoring model risk in real time, providing “explainability” on artificial intelligence deployments, weeding out...

August 14, 2020 | By Katherine Heires


Quantamental Risk Management: Seeking New Alpha

To improve alpha, quantamental portfolio managers combine fundamental analysis with various quantitative approaches. By identifying patterns and statistical relationships across fundamental and...

August 7, 2020 | By Peter Went


Force Multipliers for an Endless War

There is nothing simple about cyber warfare, but, for the sake of argument, think of it as boiling down to two opposing sides. On the offensive are those that break through defenses stealthily and...

August 7, 2020 | By Jeffrey Kutler


For When Artificial Intelligence Goes Awry: Incident Response Plans

Many organizations are experimenting with, if not purposefully deploying, artificial intelligence. But what happens when those systems or the decision models they power go haywire, decay, or are...

July 31, 2020 | By Katherine Heires


A New, 'Competitive' Phase of Crypto-Asset Regulation

Historically, financial regulatory agencies were anything but centers of innovation and were assumed to be a step or two behind the institutions they supervised, particularly when it came to...

July 24, 2020 | By Jeffrey Kutler


Solving the ESG Data Challenge

Prompted by a push by investors to incorporate environmental, social and governance (ESG) issues in their analysis of investment risk, credit-rating agencies are advancing efforts to integrate these...

July 17, 2020 | By John Hintze


AI-Based Decision Making: "Computer Says No"

The most endearing sketches of Little Britain, a BBC comedy show, features a character named Carol Beer. Carol always responds to a customer's enquiry by typing into her computer and responding, even...

July 10, 2020 | By Peter Went


Will COVID-19 Transform the Banking Landscape?

Even as the world gradually reopens, traditional banks are facing an uncertain future, rife with vanishing revenues, huge projected credit losses, declining earnings and stiff digital banking...

June 12, 2020 | By Peter Went


The Anti-Money Laundering Challenge: How to Improve Transaction Monitoring

Money-laundering scandals have been the bane of financial institutions for two decades, and 2020 is proving no different. Faced with ever-increasing regulatory-enforcement actions, many firms...

June 5, 2020 | By Sven Stumbauer


New Fit for Blockchain: Securities Lending at the OCC

The fanfare may not be quite what blockchain promoters were anticipating a few years ago, but the technology is gradually and noticeably establishing itself as a component of financial market...

May 29, 2020 | By Jeffrey Kutler


COVID-19 and Operational Resilience: How Past Crises Shape Today's Response

The COVID-19 health crisis has changed how we live and work, and while the pandemic is unprecedented, many of its impacts on financial services firms and their operations are not unlike what we've...

May 22, 2020 | By Dan Thieke


COVID-19 and the New Surge in Alternative Data

Assessing the various business risks, sector disruptions and investment opportunities brought on by COVID-19, AllianceBernstein chief risk officer Andrew Y. Chin does not merely scan the regular run...

May 15, 2020 | By Katherine Heires


Disruption Drives the Convergence of Emerging Technologies and Innovation

Today's business leaders are dealing with unprecedented levels of disruption and uncertainty. Focused on immediate concerns, organizations have prioritized establishing flexible and secure remote...

May 8, 2020 | By Phil Ratcliff


LabCFTC's AI Assistance Challenge

The Commodity Futures Trading Commission has opened a new “competitive” front in its strategy to stimulate technology innovation. Continuing to raise its profile in parallel with other supervisory...

May 1, 2020 | By Jeffrey Kutler


COVID-19 Shines Spotlight on Fintech

Fearing the risk of community transmission during the SARS pandemic, users in Asia flocked to a small online e-commerce company, Alibaba, helping it reshape e-commerce and finance. Persistent social...

May 1, 2020 | By Peter Went


Krishna Prasad Succeeds Thomas Kim as CEO of Digital Asset Platform Tassat; Blythe Masters Becomes a Board Chair

Just over a year after becoming chief executive officer of Tassat, a New York company responsible for institutional trading and payments breakthroughs using blockchain technology, Thomas Kim has been...

April 9, 2020 | By Jeffrey Kutler


The Technology Revolution in Finance: Fintech, BigTech and AI

COVID-19 has had an unprecedented impact on the economy, society and financial institutions. While the long-term effects are uncertain, we know that the global pandemic will fundamentally transform...

April 9, 2020 | By Peter Went


Microsoft Is Piecing Together Desktop-to-Cloud Cybersecurity

Cybersecurity threats are so numerous, technically challenging and constantly evolving that technology companies are rarely so bold as to claim they have an all-encompassing solution. Large...

April 9, 2020 | By John Hintze


Risk and Opportunities in Insurance: A Changing Landscape

The business of insurance is to define, evaluate and mitigate risk. But risk is becoming less predictable, and customer expectations for the purchase and delivery of insurance are changing....

March 13, 2020 | By Phil Ratcliff


Fintech Fund Buys a Business from ACA Compliance Group

ACA Compliance Group, a company that by all accounts is thriving amid demand for governance, risk and compliance (GRC) advice, technology and services, has sold its NorthPoint technology product and...

February 28, 2020 | By Jeffrey Kutler


A Banking Service for a Warming World: Emissions Tracking for Consumers

If dire warnings about climate change on a planetary scale still seem abstract at the everyday consumer level, then the financial industry may be in a position to bring the message home by delivering...

February 28, 2020 | By Katherine Heires


Cboe Acquires Analytics and Portfolio Management Providers; Nasdaq Adds ESG-Focused OneReport

Three leading exchange companies have raised their respective competitive antes with a coincidental series of technology-driven acquisition deals. Cboe Global Markets made two for its Cboe...

February 14, 2020 | By Jeffrey Kutler


Natural Language Processing: Artificial Intelligence Ready for Prime Time

In the latest Star Wars film, “The Rise of Skywalker,” a droid robot is summoned more than once to ingest and sort through vast volumes of documentation to identify and extract critical data that...

February 14, 2020 | By Katherine Heires


Confidence in Cybersecurity Grows at the Board Level

Members of corporate boards are expressing growing confidence in their organizations' cybersecurity. According to the National Association of Corporate Directors (NACD) 2019-20 Public Company...

January 31, 2020 | By Ted Knutson


ESG Becomes a Battleground of the Exchange Titans

Listings and trading volumes are no longer sole determinants of success for stock exchange companies. They are not only trading and clearing multiple products, but have also built sizable data...

January 31, 2020 | By Jeffrey Kutler


Artificial Intelligence and Machine Learning: The Risks of Algorithmic Bias

Artificial intelligence (AI) and machine learning (ML) continue to ascend in the financial services space, receiving kudos for their ability to mitigate money laundering, improve risk forecasting and...

January 24, 2020 | By Peter Bannister


A Call for Deliberation on AI and Quantum Computing

Speaking in March 2019 at a conference in Washington, Thomas Vartanian said technologies like artificial intelligence and big data would inevitably attract regulatory intervention. The longtime...

January 17, 2020 | By Ted Knutson


Blythe Masters, Financial Blockchain Pioneer, Joins Private Equity Firm

Blythe Masters, a longtime JPMorgan bank executive who became CEO of financial industry blockchain venture Digital Asset Holdings, has joined private equity firm Motive Partners as an industry...

December 20, 2019 | By Jeffrey Kutler


Regulators Stress Risk Management in Consultations on Crypto

The New York State Department of Financial Services (DFS) and Basel Committee on Banking Supervision (BCBS) separately announced initiatives that underscore financial regulators' determination to be...

December 20, 2019 | By Jeffrey Kutler


Driverless Cars, and the Prospect of Level 5 Automation in Banking

Can disruptive technologies ever truly and completely replace human judgment in finance? We can begin our search for answers by considering automation progress in other industries. In the world of...

December 13, 2019 | By Tony Hughes


Alternative Data Can Be Good for the Credit Business, Regulators Say

U.S. regulatory agencies have issued a joint statement recognizing that alternative data can be beneficial in credit underwriting. Alternative data - defined as information other than that provided...

December 13, 2019 | By Ted Knutson


Giancarlo Joins Law Firm, Vows to Continue Digital Advocacy

The former chairman of the Commodity Futures Trading Commission, J. Christopher Giancarlo, is taking on multiple roles to stay active at what he terms “the junction of trading markets, technology and...

December 6, 2019 | By Jeffrey Kutler


How Risk Managers Can Most Effectively Apply AI

Tremendous changes are taking place in the financial services industry. Data volumes are increasing, data availability is improving, information is being shared faster, and new methods of analysis...

December 6, 2019 | By Alla Gil


Effective Cybersecurity Is 'Adaptive and Layered'

It is important to stay abreast of the latest attack schemes - see The Year's Top Attack Vectors: Review and Prepare - and frequently re-evaluate your security posture in light of any new...

November 22, 2019 | By Marcus Chung


ECB’s Coeuré to Head BIS Innovation Hub

BenoÎt CoeurÉ, whose eight-year term on the European Central Bank executive board expires December 31, will move to the Bank for International Settlements as head of the BIS Innovation Hub, which was...

November 12, 2019 | By Jeffrey Kutler


The Year's Top Attack Vectors: Review and Prepare

Cyber attacks are rapidly evolving and ever-more concerning. The success of WannaCry, NotPetya, GandCrab and others have inspired a new generation of hackers looking for a quick, lucrative score....

November 8, 2019 | By Marcus Chung


IBM Says It Can Fortify Public Cloud for Financial Services

The benefits of cloud computing are greatest on public networks like those of Amazon and Microsoft, but financial institutions have held back because of security and other perceived operational and...

November 8, 2019 | By Jeffrey Kutler


Dealing for Data: LSEG Stands Out as Others Ramp Up

If there were any doubts about the strategic importance of data in financial markets, then the $27 billion agreement on August 1 for London Stock Exchange Group to acquire Refinitiv put them to rest....

November 1, 2019 | By Jeffrey Kutler


CFTC Raises Status of Its Tech Lab, Joins Other Agencies in Global Innovation Group

Into his fourth month at the helm at the Commodity Futures Trading Commission, chairman Heath P. Tarbert is pushing the accelerator on the agency's technology and innovation. On October 10 he...

October 29, 2019 | By Jeffrey Kutler


Mitigating Cyber Security Threats: A Risk-Based Approach

Business continuity and security threats are the greatest risks a financial institution faces when choosing a vendor for an information and communication technology (ICT) service. This is especially...

October 25, 2019 | By Andrea Giacchero and Jacopo Moretti


The Cyber Insurance Gap Is Closing

If insurance has a place in risk mitigation strategy, then it should naturally extend into cyber risk management. But, to many, cyber insurance remains a puzzlement. A bare majority - 51% - of...

October 25, 2019 | By Ted Knutson


A Bid for Operational-Risk Data Aggregation and Standardization

Paul Ford brings an engineering mindset to solving a longstanding problem in operational risk management. His strategy: Aggregate risk and control data for the entire banking sector in a large-scale...

October 4, 2019 | By Katherine Heires


NIST Proposes a Privacy Framework, Seeks Public Comment

The National Institute of Standards and Technology (NIST), whose Cybersecurity Framework has become a global best-practices benchmark for information security, has embarked on a similar privacy...

September 20, 2019 | By Jeffrey Kutler


Getting Serious About Managing Third-Party Risk

Implementing a sustainable, risk-centric third-party risk management (3PRM) program starts with being methodical about translating high-level frameworks and legal and regulatory requirements into...

September 20, 2019 | By Linda Tuck Chapman


Tassat: A Range of Services Across the Blockchain Spectrum

Institutional investing and trading in crypto assets have been slow to take off, but not for lack of trying by the likes of Tassat Group. It is one of a number of ventures touting...

September 13, 2019 | By John Hintze


Northern Trust: A Custodian with Leading-Edge Leanings

With $11.3 trillion of assets under custody/administration, Northern Trust is by reputation and culture a conservative, tightly risk-managed institution underpinned by a “fortress balance sheet,”...

September 6, 2019 | By Jeffrey Kutler


Social Media Analytics and Its Place in Management Education

There is a surfeit of social media data available for anyone who cares to generate insights and use it for legitimate (or illegitimate) purposes. However, to capture the data in the best possible...

August 30, 2019 | By Sanjay Fuloria and Nupur Pavan Bang


Can Social Media Threat Monitoring Help Preempt Violence?

The March 2019 mosque shootings in Christchurch, New Zealand, especially the internet livestreaming of the first attack, has everyone talking about the use of social media threat monitoring to...

August 23, 2019 | By Keith Wojcieszek


Strength in Numbers: Consortium Blockchain Projects Make Headway

The consortium approach to financial blockchain business opportunities is gaining further validation as groups in the banking and insurance industries take their respective projects forward. Utility...

August 23, 2019 | By Juliette Fairley and Jeffrey Kutler


Hot Properties: Risk and Compliance Software

In the first half of August, Steele Compliance Solutions, NAVEX Global and Bloomberg announced acquisitions of companies active in risk- and compliance-related technologies. Their targets were,...

August 16, 2019 | By Jeffrey Kutler


A New Vision for Cybersecurity

Cyber risk is a continuously evolving, complex phenomenon that requires a new risk management approach. We are now at a turning point, facing the intersection of several simultaneous cybersecurity...

August 2, 2019 | By Andrea Giacchero and Jacopo Moretti


In Geopolitical Risk Management, a Chance for AI, Alternative Data and Predictive Analytics to Shine

In common with other categories of risk, those arising from geopolitical events - trade and tariff disputes, regional military conflicts and terrorism, domestic political uprisings and instability -...

July 19, 2019 | By Katherine Heires


BIS Follows National Regulators into the Innovation Business

The Bank for International Settlements, which included in its 2019 Annual Economic Report an analysis titled Big Tech in Finance: Opportunities and Risks, has announced BIS Innovation Hub. It will...

July 12, 2019 | By Jeffrey Kutler


A Cyber Threat to Financial Stability

In January 2015, at a Bank for International Settlements (BIS) forum in South Africa, Federal Reserve Bank of Boston president Eric Rosengren spoke on the subject of Cyber Security and Financial...

July 12, 2019 | By Ted Knutson


Data Woes Are Widespread and Common Across Business Sectors

Information-centric industries such as financial services are not alone in grappling with data management challenges. A survey commissioned by Dun & Bradstreet reveals that they are causing headaches...

July 3, 2019 | By Katherine Heires


The FSB's Global Risk Data Aggregation Initiative: A Review and Update

After the financial crisis, regulators rightly concluded that they needed more granular and standardized transaction data to oversee the risks inherent in financial institutions and in financial...

June 28, 2019 | By Allan D. Grody


The Agile Risk Manager

Can there be such a thing as an agile risk management function? The question is deeply important because competitive conditions are forcing more and more companies into agile and digital...

June 21, 2019 | By Haydn Shaughnessy and Fin Goulding


Leveraging Artificial Intelligence to Detect and Minimize Data-Loss Threats

Executive Summary This article outlines at a high level how artificial intelligence (AI) can help organizations proactively detect data breaches in their earliest stages, in order to prevent them...

June 7, 2019 | By Anju Chopra, Heather Williams and Eric Nyberg


Ransomware Terrorism: Should We Be Worried?

The threat of ransomware being used as a highly effective form of cyber terrorism has been receiving a lot of media attention lately. The storyline stems from a Lloyds of London report which boldly...

June 7, 2019 | By Marcus Chung


Slippage in the Cyber Arms Race

Awareness of cybersecurity threats, and actions being taken against them, are on the rise - but that hasn't stemmed the tide of cyber attacks and their financial toll. Companies therefore appear to...

May 31, 2019 | By Juliette Fairley


A Broker-Dealer Route for Blockchain

The general buzz around blockchain revolves around its long‐term potential to disrupt or displace traditional business processes or transaction flows. The near-term reality is that building blocks...

May 31, 2019 | By John Hintze


No Dissent on Data Standardization

Data standardization and open data architecture - which supports interoperability among information systems of the government and the private sector - hold tremendous promise for the financial...

May 17, 2019 | By Katherine Heires


Human Versus Machine: The Pros and Cons of AI in Credit

In recent years, attention has increasingly turned to the promise of artificial intelligence (AI) to further increase credit availability and to improve the profitability of banks and other lenders....

May 17, 2019 | By Tony Hughes


BitGo Bolsters Custody Case with Security Certification

Cryptocurrency processor and digital-asset custodian BitGo has achieved the SOC 2 Type 2 security certification, saying it will provide an edge in attracting institutional investor interest. The...

May 3, 2019 | By Jeffrey Kutler


Innovation Amid the New Normal

Innovation is a top priority throughout the financial services industry. At BNP Paribas it is pervasive, with a bank-wide “club” of chief innovation officers, hackathons and other organized programs,...

April 26, 2019 | By Jeffrey Kutler


Financial Services Mobile Apps Are Riddled with Security Flaws

Cybersecurity risks are hardly uncommon, but there is an abundance in the world of mobile apps - and especially those provided by retail banks, brokerages and auto insurers and readily downloadable...

April 26, 2019 | By Katherine Heires


From Theory to Practice with Agent-Based Modeling

In a March press conference, Federal Reserve Board chair Jerome Powell said that U.S. economic fundamentals were strong and financial stability vulnerabilities were not at high levels. There was no...

April 26, 2019 | By Katherine Heires


The BIS-BCBS-FSB View of Crypto

Despite fluctuations in cryptocurrency prices - or perhaps because of their ongoing volatility and uncertainty - global regulatory authorities continue to monitor and sound warnings on financial...

April 18, 2019 | By John Hintze


CFTC Advisory Panel Compiles Warnings on Cloud Risks

Cloud computing services, for all their popularity, economics and operational advantages, still require special technology and risk management attention. In other words, nothing should be assumed to...

April 12, 2019 | By Ted Knutson


Survey Indicates Need for Stronger Cyber-Risk Response

Financial services C-suite interest in cybersecurity, while on the rise, doesn't always translate to on-the-ground action, the National Society of Compliance Professionals (NSCP) says. A recently...

March 29, 2019 | By Ted Knutson


Cyber Law Expert Anticipates Regulatory Response to AI, Big Data

Regulation has barely begun to have an impact in areas of big data and artificial intelligence, but veteran financial industry lawyer and technology expert Thomas Vartanian said it is only matter of...

March 29, 2019 | By Ted Knutson


Quantum Computing and the Coming Threat to Data Security

Cybersecurity threats are a clear and present danger to businesses, governments and critical infrastructures. The National Institute of Standards and Technology made a significant contribution to...

March 29, 2019 | By Jeffrey Kutler


At tZERO, Blockchain Tech Development Turns to Action

Amid continuing debate over the viability of blockchain technology in financial services, online retailer Overstock.com's capital-markets-focused tZERO is pressing ahead. The venture has laid out...

March 22, 2019 | By John Hintze


As Mobile Activity Grows, So Do Cyber Attacks

Sixty-seven percent of financial service transactions - including online banking, money transfers, and stock trades - now come from mobile devices. That has grown 13% year-over-year, according to...

March 22, 2019 | By Katherine Heires


When Machine Learning Models Grow - Rather Than Just Contain - Risk

Artificial intelligence is growing rapidly and could have a transformational impact on the banking industry, but according to McKinsey & Co. risk practice experts, it is not a risk-free event. If...

March 15, 2019 | By Katherine Heires


NACD Calls In a Cyber Risk Adviser

With board governance newly challenged by cybersecurity issues, the National Association of Corporate Directors is turning to Christopher Hetner as its special adviser for cyber risk. “The days for...

March 15, 2019 | By Ted Knutson


A Breakthrough Is Claimed in Systemic Risk Monitoring

More than 10 years since the global financial market meltdown, regulators and central bankers are confident that a stronger and well capitalized banking system is better able to withstand another...

February 22, 2019 | By Katherine Heires


Nasdaq Agrees to Sell GRC Software Business

Governance, risk and compliance (GRC) software company BWise, which has been owned by Nasdaq since 2012, is being sold to SAI Global. The agreement was announced on February 11, and the transaction...

February 15, 2019 | By Jeffrey Kutler


Preparing for SEC Cyber Compliance

Cybersecurity continues to be a primary focus area for the U.S. Securities and Exchange Commission's Office of Compliance Inspections and Examinations (OCIE), as indicated in their 2019 examination...

February 15, 2019 | By Askari Foy


SEC's Peirce: Fintech Is Risky, Get Used to It

In 13 months on the Securities and Exchange Commission, Hester M. Peirce has pushed for openness to innovation, even criticizing the SEC majority last July for rejecting the listing of a Bitcoin...

February 15, 2019 | By Ted Knutson


Information Overload: The Risk Documentation Challenge

For banks, one of the more onerous aspects of regulatory supervision is documentation. Regulators demand detailed descriptions of the models being used and banks have responded by the bucket-load. To...

February 8, 2019 | By Tony Hughes


Oliver Wyman to Incumbent Banks: Go Greenfield

A typical annual state-of-the-industry report might include a compilation of key performance indicators, economic projections and demographic trends. Consulting firm Oliver Wyman's 2019 state of the...

February 1, 2019 | By Ted Knutson


Top 7 Risk Management Predictions for 2019

Brenda Boultwood If there's anything that we've learned from 2018's scandals around data privacy, money laundering and sexual misconduct, it's that an organization's performance and success are only...

January 25, 2019 | By Brenda Boultwood


Strategic Risk Will Be Front and Center in 2019

Blame it on indigestion from all the holiday feasting recently that's left me more pessimistic heading into the new year, but 2019 appears to be one of the most perilous in decades in terms of...

January 18, 2019 | By Clifford Rossi


Cyber Threats Are Recognized, but Are Companies Prepared?

Although cyber threats are universally regarded as pervasive and even existential, Michael Daugherty believes that many businesses are not well organized to manage the risks. He has founded the Cyber...

January 11, 2019 | By Ted Knutson



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