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Sunday Book Review

Sunday Book Review: February 16, 2025 The Books on AI Edition

In the Sunday Book Review, Tom Fox considers books that would interest the compliance professional, the business executive, or anyone who might be curious. These could be books about business, compliance, history, leadership, current events, or anything else that might interest Tom. Today, we have a five-book look at the top books on AI for 2025.

  1. Artificial Intelligence: A Modern Approach by Stuart Russell and Peter Norvig
  2. The Singularity Is Nearer: When We Merge with AI by Ray Kurzweil
  3. The Alignment Problem: Machine Learning and Human Values by Brian Christian
  4. Supremacy: AI, ChatGPT, and the Race that Will Change the World by Parmy Olson
  5. Nexus: A Brief History of Information Networks from the Stone Age to AI by Yuval Harari

Resources:

The Best Books on AI in 2025. In FiveBooks.com

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

 

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Compliance Tip of the Day

Compliance Tip of the Day – Using AI to Build ‘Tone at the Top’

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review how AI can help to establish and maintain an appropriate tone at the top for a best practices compliance program.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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Compliance Tip of the Day

Compliance Tip of the Day – Using GenAI to Make Small Transformations

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review how to begin using AI to make small transformations and build up to larger ones.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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All Things Investigations

All Things Investigations – DeepSeek’s AI Revolution: Implications for Compliance and Security

Welcome to the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group’s podcast, All Things Investigation. In this podcast, host Tom Fox is joined by HHR Partner Mike Huneke and Brent Carlson from the Berkeley Research Group.

Brent Carlson and Mike Huneke review the recent DeepSeek AI announcement, which has stirred significant debate in the business and compliance sectors. Brent views this development as a “Sputnik moment” in the technology space, highlighting both the exciting potential and the profound implications for national security and corporate strategy, particularly due to the dual-use nature of AI technologies. On the other hand, Mike has expressed concern over the contentious debates surrounding export controls, emphasizing the necessity for robust compliance frameworks to mitigate liability risks and adapt to the evolving AI landscape. Together, they stress the importance of incorporating high probability standards and reliable inputs into compliance programs to effectively navigate the complex challenges of advanced AI technologies like DeepSeek, ensuring corporate citizenship and strategic advantage in this new era.

Key highlights:

  • Groundbreaking AI Progress Raises National Security Concerns
  • AI Market Disruption by DeepSeek Technology
  • High Probability Standard in Export Control Compliance
  • Subjective Judgment in Compliance Risk Assessment Framework
  • Red Flag Detection with Data Analytics Tools

Resources:

Hughes Hubbard & Reed website

Brent Carlson on LinkedIn

A Fresh Look at US Export Controls and Sanctions

DeepSeek Finds US Export Controls at a New ‘Sputnik Moment’ in Bloomberg Law

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Daily Compliance News

Daily Compliance News: February 11, 2025, The Pause in FCPA Enforcement Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News—all from the Compliance Podcast Network. Each day, we consider four stories from the business world: compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • Trump orders pause in FCPA enforcement. (WSJ)
  • What is illegal DEI? (NYT)
  • AI washing for lawyers. (Reuters)
  • US companies whine about EU and ESG rules. (Bloomberg)

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

Check out the FCPA Survival Guide on Amazon.com.

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Compliance Tip of the Day

Compliance Tip of the Day – Building Trust in AI with Blockchain

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review how compliance professionals can build trust for AI through blockchain.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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Compliance Tip of the Day

Compliance Tip of the Day – Building a Data-Driven Culture

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review how compliance can drive a data-driven culture in the compliance function and throughout the organization.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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Blog

Building Trust in AI with Blockchain: A Compliance Perspective

Artificial Intelligence (AI) has rapidly become a key driver of business decision-making across industries, from financial services to healthcare. Yet, despite its enormous potential, AI remains a “black box” that raises serious concerns about transparency, accountability, and fairness. According to Pew Research, 52% of Americans are more concerned than excited about AI, while only 10% express enthusiasm. This trust deficit presents a critical challenge for compliance professionals: how can organizations demonstrate responsible AI use and ensure compliance with evolving regulatory expectations?

I was therefore intrigued to read a recent article in the Harvard Business Review by Scott Zoldi and Jordan T. Levine entitled, Using Blockchain to Build Customer Trust in AI. Their response to this quandary was to look at FICO, a leader in financial analysis and ratings, which developed a private blockchain that automated documentation and standards in model development. FICO’s approach leaned directly into a series of strategies used by compliance professionals.

The Compliance Challenge of AI

AI’s ability to analyze vast amounts of data and generate predictions is its greatest strength and its most significant liability. Machine learning models can reinforce biases, lack interpretability, and operate without clear accountability. Compliance professionals must address these challenges head-on by ensuring that AI models are:

  • Interpretable: Customers and regulators need to understand how AI models make decisions.
  • Auditable: Organizations must maintain detailed records of AI development and deployment.
  • Enforceable: Compliance teams need mechanisms to ensure adherence to ethical AI standards.

Without these three pillars, AI risks becoming a compliance nightmare that could lead to regulatory penalties, reputational damage, and loss of customer trust.

Blockchain ensures that AI models are developed following internal guidelines and regulatory requirements. Every modification to the model, from data selection to algorithmic tuning, is permanently recorded, making it easier for compliance officers to track decisions and pinpoint the cause of any discrepancies. This immutable nature benefits industries with strict regulations, such as finance and healthcare, where audits and regulatory reviews are routine.

Additionally, blockchain helps prevent unauthorized alterations by requiring cryptographic verification before changes are accepted into the system. Any attempt to introduce bias, manipulate datasets, or adjust algorithms must be documented and approved transparently. This enhances accountability and strengthens organizational trust in AI.

Blockchain’s integration into AI governance fosters cross-functional collaboration between compliance, legal, and data science teams. Using a single, tamper-proof source of truth, organizations can streamline communication and ensure that AI-related decisions align with corporate policies and industry standards. This collaborative approach mitigates risks and reduces inefficiencies, allowing businesses to innovate responsibly while maintaining regulatory compliance.

For compliance professionals, blockchain provides an operational framework supporting continuous AI model monitoring and improvement. It facilitates real-time oversight, allowing organizations to identify potential compliance risks before they escalate into regulatory violations or reputational damage. As AI technology evolves, blockchain’s role in governance will likely expand, offering even greater opportunities for secure, transparent, and ethical AI development.

Blockchain: A Path to AI Accountability

Blockchain technology offers a potential solution by providing an immutable, transparent record of AI model development and decision-making. The authors reviewed FICO’s adoption of blockchain. They learned, “Making this system work was less a tech challenge than a people one. They learned it was important to start with standards, then develop the tech; that making the system user-friendly was non-negotiable; that it was essential to iterate on quick wins; that they had to build repositories to hold large AI assets in alternate storage; and that they needed capable IT teams to handle the maintenance demands of this system.”

By moving from traditional documentation methods (such as Word documents) to a private blockchain, FICO:

  • Reduced model support issues and recalls by over 90%.
  • Created a single source of truth for AI model development.
  • Ensured absolute adherence to AI governance standards.

Blockchain’s ability to create an auditable trail of every change, test, and decision made during AI model development provides a powerful compliance tool. Unlike conventional documentation, blockchain prevents unauthorized changes and ensures compliance teams can verify AI decisions long after they are made.

Beyond compliance, blockchain enhances the efficiency of AI governance by automating tracking mechanisms that reduce administrative burdens. Traditionally, managing AI development required extensive oversight, documentation, and verification processes, often prone to human error or oversight. By leveraging blockchain, organizations can automate this oversight, ensuring that model updates, training datasets, and algorithmic adjustments are securely recorded in a tamper-proof ledger. This improves compliance and accelerates AI innovation by reducing bottlenecks in model validation.

Additionally, blockchain’s transparency enables better cross-functional collaboration between compliance officers, data scientists, and IT security teams. Instead of relying on disparate documentation and periodic audits, stakeholders can access a real-time, immutable ledger of AI development activities. This fosters greater accountability and ensures that AI models align with ethical guidelines, regulatory requirements, and corporate governance policies from inception to deployment.

Blockchain can mitigate risks associated with AI bias and ethical concerns by providing a structured framework for tracking model modifications and testing processes. Any deviation from approved methodologies is recorded, allowing organizations to detect and address potential issues before they impact decision-making. This proactive approach strengthens AI reliability and fosters trust among regulators, customers, and stakeholders who demand greater transparency in automated decision-making processes.

By integrating blockchain into AI governance, organizations gain a robust compliance tool that ensures models are developed responsibly, deployed ethically, and maintained transparently. As regulatory scrutiny around AI continues to grow, adopting blockchain-based governance is not just an operational advantage; it can provide both a strategy and mechanism for maintaining trust and regulatory compliance in the evolving AI landscape.

Key Compliance Lessons from FICO’s Blockchain Approach

1. Standards Must Come First

Before implementing blockchain, organizations must establish clear AI development standards. This includes defining acceptable algorithms, ethical testing methodologies, and regulatory compliance requirements. Without these guardrails, blockchain is just another technology without purpose.

2. User Adoption Requires a Seamless Experience

One of the biggest hurdles in AI governance is ensuring that data scientists comply with established processes. At FICO, blockchain-based AI governance became non-negotiable—developers could not release models without following the blockchain-tracked workflow. Making compliance seamless rather than burdensome is key to adoption.

3. AI Governance Must Be Iterative

FICO’s blockchain approach evolved, starting with small proofs of concept before scaling across its AI development teams. Compliance professionals should take a similar approach, testing blockchain governance in high-risk areas before expanding its use across the organization.

4. Immutable Records Are Key for Regulatory Defense

Regulators are increasingly scrutinizing AI-driven decisions, especially in highly regulated industries such as finance and healthcare. An immutable AI development, testing, and deployment record provides a powerful defense against regulatory inquiries. It also enables organizations to demonstrate compliance rather than scrambling to justify decisions afterward proactively.

5. Blockchain Is a Tool, Not a Silver Bullet

While blockchain enhances AI governance, it is not a substitute for a strong compliance program. Organizations must still conduct rigorous ethical testing, monitor AI performance, and engage with regulators to ensure ongoing compliance. Blockchain should be viewed as an enabler of trust, not a cure-all.

Final Thoughts: The Future of Compliance in AI Governance

As AI becomes more embedded in business operations, compliance professionals must evolve their oversight strategies to keep pace. Blockchain offers a compelling approach to ensuring AI accountability, but it requires careful implementation, clear governance standards, and buy-in from business leaders.

FICO’s success demonstrates that trust follows when AI governance is built on transparency, auditability, and enforceability. Compliance professionals who embrace blockchain’s potential can help bridge the trust gap in AI, ensuring that these powerful technologies are used responsibly, ethically, and in full compliance with regulatory expectations.

For compliance teams, the question is no longer whether AI governance needs to evolve but how quickly organizations can implement solutions that keep AI accountable. Blockchain is one step in the right direction.

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Compliance Tip of the Day

Compliance Tip of the Day – AI, Process Management and Compliance

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review aligning technology, data, and governance to enhance compliance frameworks and drive value across organizations.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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Compliance Tip of the Day

Compliance Tip of the Day – AI and Compliance Training

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we review how AI can turbo-charge your compliance training and communication.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.