Tag: GenAI

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The Future of Continuous Monitoring: AI-Driven Compliance is Here to Stay

The compliance function has officially crossed the Rubicon. Artificial intelligence is no longer an experimental technology on the compliance periphery; it is at the center of forward-thinking compliance programs. We are witnessing a seismic shift in managing risk, detecting misconduct, and maintaining corporate integrity. AI enables real-time monitoring, uncovering subtle anomalies, and delivering the kind of automated oversight previously confined to PowerPoint dreams. As we enter 2025, the question is not whether your compliance function should adopt AI but how quickly you can make it central to your operations.

This blog post explores how compliance professionals can use AI to power a future-ready, continuously monitored compliance program. Today, we will explore five powerful lessons supported by real-world case examples and framed within current regulatory expectations. As Andrew McBride described, we are entering the “Holy Grail” era of compliance, where due diligence, internal and external data, and communications can be monitored holistically through AI agents trained to detect abnormalities and investigate unethical behavior.

Lesson 1: AI Enhances Risk Detection

AI doesn’t just speed up compliance; it sharpens it. Traditional compliance teams have long struggled to keep up with massive amounts of structured and unstructured data. From financial transactions to email threads, vendor records, and chat logs, there are risk indicators that no human team could feasibly monitor in real-time. Enter AI and machine learning.

With natural language processing (NLP), AI systems can read between the lines. They detect shifts in sentiment, keyword patterns, and coded language that may indicate bribery, fraud, or circumvented controls. Matt Galvan emphasizes this as a game-changer, especially when GenAI tools synthesize background due diligence with transactional anomalies to flag red flags early before misconduct manifests.

Better still, AI eliminates the “needle in a haystack” problem. It builds outliers into profiles, detects slush fund behavior, and creates actionable summaries with supporting documentation. You are not simply faster, and you are smarter. But here’s the kicker: the quality of AI outputs depends on the quality of your inputs—poor data = poor detection. AI must be trained on clean, complete, and bias-aware datasets. And AI should never operate in a vacuum. Human judgment remains essential to interpret findings and assess the business context.

The bottom line is that AI transforms compliance from reactive to proactive. It is no longer about catching up; it is about staying ahead.

Lesson 2: Regulators Expect AI-Driven Compliance

If you need a business case for AI, start with the Department of Justice (DOJ) and its 2024 Evaluation of Corporate Compliance Programs (2024 ECCP). The DOJ has moved beyond encouragement and now expects companies to adopt real-time, AI-powered compliance monitoring. Failing to implement these tools could soon be seen as a failure to meet basic compliance standards.

This isn’t just about the DOJ. The SEC, FinCEN, OCC, Federal Reserve Board, and the Financial Action Task Force (FATF) are pushing toward a future where real-time compliance tools are a baseline requirement, not a nice-to-have. What’s more, regulators are now asking companies to explain their AI. What data powers your algorithms? How are decisions made? Can you justify why one transaction was flagged and another was not? Transparency and audibility are no longer optional; they are regulatory imperatives.

Regulators understand that AI can reduce legal risk and enhance oversight. They expect you to understand it, too.

Lesson 3: AI Identifies Emerging Geopolitical Risks

Welcome to the volatility vortex of 2025. What was a low-risk jurisdiction on Friday can be a sanctioned country by Monday. Supply chains bend and sometimes break under the weight of sanctions, tariffs, and political upheaval.

Traditional compliance programs cannot react fast enough. This is where AI earns its keep. AI flags emerging geopolitical risks before they bite by ingesting thousands of data points from news, regulatory alerts, trade databases, and internal procurement systems. Andrew McBride’s example of a virtual bill of materials is especially prescient: imagine knowing exactly where a conflict mineral is buried in your supply chain and being alerted when a regulatory status changes.

AI makes it possible. Galvan pointed out that the same data sets used to optimize supply chains can be re-leveraged for compliance risk analysis. In other words, compliance teams should not operate with less information than procurement or logistics. If you are waiting for geopolitical risk to reach your front door, sadly, you are already behind. AI enables a proactive posture to protect your business from international surprises.

Lesson 4: Automating Compliance Reduces Costs and Increases Efficiency

Efficiency is often an underappreciated outcome of effective compliance. But let’s be clear: automation isn’t just about doing things faster; it is about doing them better and cheaper. AI automates transaction monitoring, scans for real-time anomalies, and triages cases for deeper review. No more relying on random audits or static checklists. AI helps compliance programs scale, especially for global companies managing thousands of vendors and counterparties.

Consider regulatory reporting: AI can automate data collection and reporting preparation, ensuring timely submissions and reducing the burden on internal teams. These efficiencies translate directly into cost savings while improving quality.

McBride’s point about AI-driven NLP catching potential bribery schemes in real-time is a glimpse into what’s already possible. Emails, Teams messages, and Slack conversations are goldmines of risk insight when monitored responsibly and legally. Just-in-time risk flags make compliance not only real-time but also real-impact.

AI is your accelerator if you want a leaner, faster, and smarter compliance function.

Lesson 5: Early Adoption of AI Is a Competitive and Ethical Advantage

Finally, we come to the business case. Early adopters of AI-driven compliance are already reaping the rewards. Not just in regulatory peace of mind but in market leadership.

AI enables transparency, consistency, and accountability. It allows organizations to demonstrate good governance, not just say they care about it. That builds trust with investors, customers, and regulators alike. It also helps embed a culture of integrity. By quickly catching issues and addressing them, AI empowers ethics to be lived, not laminated on a wall. And companies that bake ethics into their business model outperform over the long term.

The inverse is also true: those who delay AI adoption will soon find themselves scrambling to catch up, facing increased regulatory scrutiny and higher costs. The future of compliance is not five years away. It’s now. Organizations that embrace AI today will be tomorrow’s industry leaders in ethics, governance, and profitability.

AI is not simply a tool; rather, it is transformational. It allows compliance professionals to do more, do it faster, and do it better. But success requires more than just buying technology. It requires thoughtful integration, rigorous oversight, and a strategic mindset. Continuous monitoring is the future, and the future has arrived. Together, let us build compliance programs that are not only compliant but also resilient, efficient, and ethical.

The above is from my latest book, Upping Your Game: How Compliance and Risk Management Move to 2030 and Beyond, available from Amazon.com.

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Compliance Tip of the Day

Compliance Tip of the Day – Leveraging AI for Real-Time Third-Party Risk Management

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, Tom Fox considers the advantages of using AI for third-party risk management.

For more on embedded compliance, check out my new book, Upping Your Game: How Compliance and Risk Management Move to 2030 and Beyond, available from Amazon.com

 

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Predictive. Proactive. Protected: Leveraging AI for Real-Time Third-Party Risk Management

Even in 2025, third-party risk management remains one of the thorniest challenges for compliance professionals. Whether you oversee distributors in the Middle East, suppliers in Southeast Asia, or data processors in Eastern Europe, the risks, including bribery, sanctions violations, labor abuses, and fraud, remain ever-present. Traditionally, compliance teams fought these battles using static tools: onboarding questionnaires, annual reviews, and spreadsheet trackers. But those blunt instruments are no longer enough in today’s real-time risk environment.

Enter AI, specifically Generative AI (GenAI), predictive analytics, and blockchain, which is revolutionizing third-party oversight and giving compliance professionals the power to act proactively, not reactively. As Jag Lamba, CEO of Certa, astutely notes, GenAI brings three significant value buckets: reduced risk, commercial ROI, and reduced legal costs. Today, I will unpack what that means for compliance and how we can move from the “check-the-box” era to one of integrated, continuous monitoring and risk mitigation.

Compliance in Real Time: The Shift to Predictive Tools

Historically, the compliance approach to third-party risk was episodic. We conducted due diligence at onboarding, maybe revisited it every few years, and crossed our fingers in between. However, the gaps between assessments were dangerous blind spots, exposing companies to risks that regulators like the DOJ and SFO are increasingly unwilling to tolerate.

That’s where predictive analytics steps in. To forecast potential violations, these systems analyze structured and unstructured data, from financial records to adverse media to geopolitical trends. AI flags early risk indicators, such as an unusual payment pattern or a politically exposed person. That allows compliance to intervene before a deal closes, a bribe is paid, and reputational damage is done.

Machine learning (ML) models also allow dynamic anomaly detection. This is especially useful in sifting through transactional data and flagging high-risk behavior patterns like duplicate invoices, mismatched documentation, or sudden changes in third-party ownership.

Blockchain brings an additional layer of trust. Immutable audit trails secure contracts, payments, and due diligence documentation, ensuring the record is tamper-proof and regulator-ready. Smart contracts can enforce compliance obligations automatically, stopping payments, triggering alerts, or suspending activity when a vendor falls out of bounds.

Three Buckets of Value: What GenAI Delivers

Jag Lamba, CEO of Certa, outlined three distinct areas where GenAI delivers:

  1. Risk Reduction – Compliance risk, data privacy risk, ESG risk, reputational risk—the list goes on. AI helps companies avoid working with third parties that introduce these risks into the business ecosystem. This is more than good practice; it is a lifeline for organizations operating under Deferred Prosecution Agreements (DPAs) or with heightened scrutiny from regulators.
  2. Commercial Value – Faster onboarding of sales agents, vendors, or channel partners means faster revenue. Reducing a six-week onboarding timeline to two days can translate into hundreds of millions in new revenue, especially in fast-moving sectors.
  3. Legal Savings – Avoiding regulatory missteps means avoiding costly enforcement actions. In today’s aggressive enforcement climate, those savings are not simply theoretical; they are very real and very substantial.

Compliance should not be a handbrake on business; it should be a business enabler. By embedding GenAI into core operations, organizations create less friction and fewer dual processes, improving business agility without sacrificing oversight.

Five Takeaways for Compliance Professionals

  • Predictive Compliance Is the New Norm

The days of “wait and see” are over. AI lets us anticipate risk, not just react to it. Predictive tools shift compliance from being an internal auditor to a strategic partner in risk mitigation. Companies like Certa use automated third-party master data enrichment to reduce false positives and streamline screening, creating cleaner data for faster, smarter decisions.

  • AI Supercharges Due Diligence

Natural language processing (NLP) and machine learning enable deep due diligence at scale. To flag red flags, AI can scan global watchlists, sanctions databases, court records, and newsfeeds. It can uncover hidden connections, shell entities, familial relationships, and obscure affiliates that human reviewers often miss.

Even better, AI does not sleep. It continually updates third-party risk profiles in real time, offering dynamic monitoring that aligns with today’s fast-changing regulatory landscape.

  • Real-Time Supply Chain Monitoring Is a Must

Supply chains are now under a microscope. From human rights to trade sanctions, regulators demand evidence that companies are proactively managing supply chain risks. AI tools monitor supplier behaviors and flag real-time ESG risks, such as forced labor or environmental non-compliance.

Blockchain ensures that supply chain data remains unaltered and provides traceability across multiple tiers of suppliers. With AI-integrated blockchain systems, compliance professionals can quickly identify issues, trace them to their source, and take corrective action.

  • AI + Blockchain = Fraud and Corruption Prevention

Fraud detection meant following static rules, like transaction thresholds or vendor location mismatches. AI adds nuance. It can detect bribery patterns or fraudulent shell entities by learning from thousands of real-world cases. Meanwhile, blockchain creates an unchangeable record of each transaction, making it harder for corrupt actors to falsify invoices or backdate payments. This two-pronged approach, predictive analytics plus immutable records, offers a potent defense against FCPA and UKBA violations.

  • Third-Party Risk Must Be Continuous, Not Episodic

Third-party due diligence cannot be a one-and-done exercise. Predictive analytics enables a live risk-scoring environment where third parties are constantly evaluated. AI can even detect patterns that suggest “compliance-sensitive” activity, like vendors interacting with government officials or operating in high-risk jurisdictions, flagging them for further review.

One multinational recently implemented a no-code solution that monitors purchase requisitions for signs of regulatory engagement, triggering automated validation questions. This kind of innovation is only possible when compliance works in tandem with IT, legal, and procurement.

Compliance at a Crossroads: Innovate or Fall Behind

After the Trump Administration’s Executive Order suspending FCPA investigation and enforcement, compliance professionals face a fundamental choice: evolve or be eclipsed. But in 2025, manual reviews and siloed spreadsheets. Business leaders expect real-time monitoring, cross-functional integration, and data-backed decision-making to create greater business value. That means compliance must step into a new leadership role that embraces technology, champions cross-department collaboration, and drives value across the enterprise.

It is time for compliance teams to stop seeing AI as a future concept and start seeing it as a present-day imperative. The organizations that embrace this shift will thrive in the next wave of regulatory scrutiny and be best equipped to meet the moment.

As the saying goes, “The best way to predict the future is to invent it.” For compliance professionals, that future is AI-driven, real-time, and risk-resilient.

This article was based on my new book, Upping Your Game. You can purchase a copy of the book on Amazon.com.

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Embedded Compliance – The Future is Integrated

For compliance professionals, it is time we discussed the groundbreaking shift happening right beneath our feet: embedded compliance. Traditionally, compliance has been viewed as a separate, distinct entity within organizations, performing manual, reactive tasks often separate from the pulse of daily business. The DOJ tried to fight this siloed approach beginning in the 2020 Update to the Evaluation of Corporate Compliance Programs (ECCP) and running through to the 2024 ECCP. A siloed approach caused inefficiencies and frequently resulted in gaps in oversight that organizations cannot afford in our hyper-regulated, fast-moving world.

Embedded compliance flips this traditional script, creating a framework where compliance checks, regulatory adherence, and risk controls are woven directly into the operational workflows. Leveraging the powerful combination of API-driven solutions, artificial intelligence (AI), and RegTech tools, embedded compliance promises seamless integration, greater agility, and significantly fewer errors. Today, I want to articulate why embedded compliance matters, how organizations integrate it into their workflows, and the practical steps compliance professionals can take to champion and lead this transformation.

From Reactive Compliance to Real-Time Integration

Historically, compliance functions often resembled firefighters, who were called upon to extinguish compliance breaches after they were already ablaze. The traditional process was linear, reactionary, and manual: compliance teams would wait for business operations to complete, then audit and identify breaches, correcting mistakes long after they occurred. Such methods left organizations vulnerable, inefficient, and frequently scrambling due to regulatory breaches.

Embedded compliance fundamentally shifts this paradigm. It brings compliance checks into the real-time business flow, using automated systems to instantly flag, halt, or address potential issues before they can materialize into full-blown compliance problems. As Andrew McBride succinctly noted, compliance is no longer separate—it’s seamlessly integrated into business processes facilitated by API-driven technology.

The Power of APIs and AI: Automating Compliance Checks

How exactly does embedded compliance work? It relies heavily on Application Programming Interfaces (APIs) and AI-driven tools integrated within existing systems to enforce real-time compliance. Let’s consider some prime examples:

1. Automated Policy Checks

A key element is embedding automated policy checks within workflows. Corporate policies and regulatory rules are encoded into a rules engine accessible via APIs. When an employee submits a transaction or expense request, the system instantly cross-checks against these policies. If an irregularity or breach is detected, such as exceeding spending limits or using unauthorized vendors, the system immediately flags or blocks it. Banks have adopted this method extensively, ensuring that products offered to customers comply with cross-border regulations at the point of sale. Embedding such checks drastically reduces the incidence of inadvertent breaches and the workload of compliance teams.

2. AI-Powered Contract Reviews

Another powerful implementation is in contract review processes. AI tools, integrated through APIs into contract management systems, scan contracts in real-time, flagging non-compliant language or omissions. Modern AI systems can instantly verify GDPR clauses, regulatory adherence, and internal policy compliance, offering corrections on the fly. Platforms like DocuSign use AI-assisted reviews to empower business users, ensuring regulatory and internal policy compliance even before a human legal team reviews the agreement, thus significantly speeding up the contracting process without adding compliance risk.

3. Real-Time Compliance Scoring

Companies today need continuous visibility into their compliance status. Real-time compliance scoring achieves this by dynamically assessing operations against regulatory standards or risk models. Cybersecurity platforms, for instance, can continuously update an organization’s compliance status against benchmarks like PCI DSS or ISO 27001. Likewise, financial institutions apply this approach to anti-money laundering (AML), using automated systems that score transactions against risk models and halt those flagged as high-risk, ensuring AML compliance on the fly.

4. Policy Review and Continuous Update

Embedded compliance also transforms how compliance policies are developed, reviewed, and refined. AI-driven solutions synthesize real-time feedback and employee queries into valuable insights, ensuring policies remain current and relevant. Automated tracking and analysis allow compliance professionals to swiftly identify problem areas, triggering targeted updates, training, and internal communications that foster a robust compliance culture.

Practical Lessons for Compliance Professionals

As compliance shifts from a manual, reactive function into a proactive, integrated approach, the role of compliance officers is undergoing a profound evolution. Here are five practical lessons compliance professionals must embrace to champion embedded compliance successfully:

Lesson 1: Embrace Technology as an Enabler, Not a Replacement

AI and automation are critical tools that free compliance professionals from repetitive, manual tasks. However, these technologies augment rather than replace human judgment. Professionals should retain oversight, interpret AI-generated alerts, tune automated models, and handle nuanced decisions that technology alone cannot navigate effectively.

Lesson 2: Design Compliance into Processes from the Start

Compliance must not be a postscript; it needs to be embedded from the inception of any business process. By collaborating closely with product development, operations, and IT teams, compliance professionals ensure regulatory and policy compliance is integral from the outset, preventing costly and disruptive corrective actions later.

Lesson 3: Leverage APIs and Automation to Reduce Manual Work

Compliance teams should proactively identify manual, repetitive compliance tasks suitable for automation via APIs or Robotic Process Automation (RPA). By automating these routine tasks, compliance officers can focus on higher-value activities such as strategic oversight, risk assessment, and complex investigations, maximizing efficiency and accuracy.

Lesson 4: Maintain Data Quality and Tackle Silos

Embedded compliance effectiveness depends critically on data quality. Compliance professionals must champion initiatives to improve data accuracy, consistency, and integration, ensuring that automated checks and AI-driven analyses rely on trusted data sources. Breaking down data silos is essential; an integrated data landscape strengthens the effectiveness and reliability of compliance efforts.

Lesson 5: Champion a Culture of Compliance and Train for Adoption

Finally, embedding compliance successfully requires widespread adoption and cultural buy-in. Compliance professionals should take active roles as educators, clearly communicating the benefits and functions of embedded compliance systems. Regular training, openness to feedback, and continuous improvement ensure frontline employees adopt and value embedded compliance, making compliance everyone’s responsibility and elevating the organizational compliance culture.

Shaping the Future of Compliance

Embedded compliance marks a significant departure from traditional compliance methods. It presents an exciting opportunity for compliance professionals to become proactive, strategic architects of integrated, real-time compliance solutions.

In this brave new world, compliance officers no longer merely enforce rules; they actively shape business processes, data integrity, and technological innovations to safeguard their organizations. By embracing APIs, AI-driven solutions, and the principles of compliance by design, compliance teams can help their organizations navigate regulatory landscapes with unprecedented agility, effectiveness, and efficiency. The future of compliance is integrated, proactive, and embedded. Are you ready to lead your organization into this transformative era?

This is taken from the new book Upping Your Game: How Compliance and Risk Management Move to 2030 and Beyond, available from Amazon.com.

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Upping Your Game – Compliance Moves into the 2030s

On February 10, 2025, the Trump Administration suspended investigations under and enforcement of the Foreign Corrupt Practices Act via Executive Order. Many compliance professionals have since wondered what this will mean for corporate compliance programs. Hui Chen, in a blog post entitled Pause in FCPA Enforcement: Crisis or Opportunity?, said, “Many in the compliance world have expressed lament, concerns, and anger. Understandably so. This may feel like an existential crisis for an industry so dependent on enforcement as its raison d’être. Yet, in every crisis, there is an opportunity. This is no exception.” She stated, “We will have the opportunity to find out which companies do not believe they need to engage in bribery to be competitive. But we will also see companies recalibrate their risk tolerance not because the door to foreign bribery has been wedged open, but because their past fear-driven strategy resulted in a sometimes overly narrow view of corporate risk and responsibility in this space.” She listed three key areas to start, the third being “it’s time to up your game.”

I agreed wholeheartedly with Chen. Inspired by Chen, I wanted to write a book for compliance professionals about how they could think through ‘Upping Their Game’ using currently existing Generative AI (GenAI) tools to improve their compliance programs dramatically. It all starts with the precept from Carl Hahn, “To me, the animating reason for our compliance program was to deliver business value. And that was my proposition on day one. It is a positive business-forward proposition based on returning on investment, returning value to the business, being part of the business strategy, enabling the achievement of strategic goals, and enabling the company to successfully deliver to its customers, investors, stakeholders, and employees.” As compliance professionals, it is critical to recognize that this moment is not merely about incremental improvements. The Trump Executive Order brings to the compliance profession a rare inflection point where revolutionary technological advancements, if harnessed strategically, can elevate our profession to a new level of effectiveness, efficiency, and organizational value.

Once reliant on manual oversight, reactive reporting, and periodic audits, compliance monitoring is evolving into a proactive, real-time capability empowered by sophisticated AI technologies. Compliance professionals historically functioned as gatekeepers, viewed as necessary but inconvenient barriers to business velocity. But now, driven by AI, compliance stands poised to shed that restrictive image, embedding directly into core operational workflows and thus shifting from gatekeeper to integral business partner.

Today, the cutting edge of compliance is driven by two primary strands of AI: predictive analytics, leveraging machine learning, and GenAI. Each has distinct capabilities, but combined, they represent a powerhouse able to address the vast majority of traditional compliance challenges and emerging risks. At its core, compliance seeks to identify, manage, and mitigate risks. Traditionally, this has meant looking backward, investigating past issues, and reacting to problems after they occur. AI fundamentally shifts compliance from this rearview mirror perspective to a forward-looking, predictive posture. Machine learning technologies empower compliance officers to train AI models on vast quantities of historical data, teaching systems to recognize patterns and indicators that suggest elevated risk in real-time.

Today, a compliance officer can use predictive analytics to tag transactional data by risk category, identifying potential bribes, improper payments, fraud, conflicts of interest, and sanctions violations. With these capabilities, compliance teams can proactively identify, isolate, and remediate issues before they escalate, significantly reducing organizational exposure and regulatory risk.

This shift from reactive to proactive risk management also enhances compliance agility. Organizations equipped with AI-powered monitoring can swiftly pivot to address new regulatory developments or emerging business risks. Because AI can integrate and analyze data in real-time from diverse sources, such as financial records, employee communications, operational metrics, and third-party data, the organization is positioned to respond to regulatory inquiries swiftly, accurately, and effectively, thus greatly enhancing compliance resilience.

AI offers a transformative capacity to integrate compliance directly into essential business processes by embedding compliance directly into an organization’s operations. Andrew McBride’s approach is termed the “Holy Grail” for compliance professionals who seek to seamlessly embed compliance responsibilities within operational workflows, enabling employees to carry out compliance tasks without interrupting their regular business activities.

For all these reasons and more, I am thrilled to announce the publication of my latest book, Upping Your Game: How Compliance and Risk Management Move to 2030 and Beyond. The compliance function is uniquely situated to lead the management of risk going forward, and in this book, I provide every compliance professional with key tactics, concepts, and strategies to move forward with GenAI today to answer the call to Up Your Game. Each chapter is dedicated to one area of a compliance program: risk management, third parties, training, chatbots, and embedded compliance. I provide key lessons for compliance professionals in each chapter and a case study on how one or more companies have created GenAI tools that can be adapted for compliance. Each one of these strategies meets Hahn’s precept to enhance business value.

I  interviewed some of the top thinkers on GenAI in the compliance field for this book. Contributors included Vincent Walden, CEO of konaAI, a global, AI-driven technology company focused on anti-fraud, anti-corruption, and compliance risks. Matt Galvin, co-founder of Gentic Global Advisors. Carl Hanh, co-founder of Gentic Global Advisors. Dr. Hemma Lomax, Deputy General Counsel, Vice President, Global Head of Ethics and Compliance at Docusign. Jag Lamba is the founder and CEO of Certa. Eric Sydell is a co-founder and CEO of Vero AI.

I hope you check out the book and use it as a basis for Upping Your Game going forward. KonaAI, a leading data analytics firm, sponsored this book.

You can purchase a copy of the book on Amazon.com.

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Compliance and AI

Compliance and AI: Harnessing Generative AI for Compliance: An Interview with Eric Sydell

What is the role of Artificial Intelligence in compliance? What about Machine Learning? Are you using ChatGPT? These are but three questions we will explore in this cutting-edge podcast series, Compliance and AI, hosted by Tom Fox, the award-winning Voice of Compliance. In this episode, Tom is joined by Eric Sydell, co-founder and CEO of Vero AI, to discuss the intersection of AI and compliance.

Eric shares his unique journey from industrial psychology to HR technology and ultimately to the realm of compliance through AI. They explore how Vero AI utilizes generative AI to analyze and interpret vast amounts of unstructured data at scale, such as text, video, and imagery. Eric emphasizes that AI provides a scalable solution for compliance processes, reducing manual labor and increasing efficiency.

Eric discusses the importance of AI governance in compliance, particularly in light of emerging standards like ISO 42001 and the EU AI Act. He introduces the Vero AI’s Violet Impact Model, which provides a comprehensive framework for evaluating the impact of algorithms and complex systems. The conversation covers practical applications of Vero AI in corporate procurement and risk management, highlighting how the tool can assist compliance officers in continuously monitoring and improving their compliance programs. Eric concludes by explaining how businesses can reach out to learn more about implementing these advanced AI-driven solutions.

Key highlights:

  • Generative AI and Unstructured Data
  • AI in Compliance and Predictive Models
  • AI Governance and Monitoring
  • The Violet Impact Model
  • Vero AI in Risk Management and Procurement

Resources:

Eric Sydell on Linkedin

Vero AI

Tom Fox

Instagram

Facebook

YouTube

Twitter

LinkedIn

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Innovation in Compliance

Innovation in Compliance – Navigating AI Governance in 2025 with Christine Uri

Innovation comes in many forms, and compliance professionals need to be ready for it and embrace it. Join Tom Fox, the Voice of Compliance, as he visits with top innovative minds, thinkers, and creators in the award-winning Innovation in Compliance podcast. In this episode, host Tom Fox welcomes Christine Uri to discuss her insights and experiences in AI governance.

Christine shares her extensive background as a legal executive and outlines her current work in advising general counsels on governance and sustainability issues at her consulting firm, CURI Insights. Christine emphasizes the importance of a cross-functional committee to oversee AI governance and highlights AI technology’s rapid evolution and inherent risks. The episode also covers the implications of the EU AI Act, the urgency of building AI literacy, and the challenges of managing AI risks in a dynamic regulatory landscape. As AI continues to evolve at a breakneck pace, Christine offers practical advice on how companies can keep up and ensure robust governance frameworks are in place to mitigate risks.

 

Key highlights:

  • AI Governance and Compliance
  • AI Governance in 2025
  • EU AI Act and Its Implications
  • Building AI Literacy in Compliance
  • Future of AI and Compliance

Resources:

Christine Uri on LinkedIn

Allie K Miller

Luiza Jarvosky

Hard Fork podcast

CURI Insights

Tom Fox

Instagram

Facebook

YouTube

Twitter

LinkedIn

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Compliance Tip of the Day

Compliance Tip of the Day – Chatbots in 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 look at the use of chatbots in a best practices compliance program.

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AI Chatbots in Compliance

AI-powered compliance chatbots are not just an incremental improvement; they represent a transformative shift, turning static codes of conduct into dynamic, interactive assistants. Employees no longer must flip through pages of policy manuals or wait days for an answer from compliance staff. Instead, these digital advisors immediately deliver instant, consistent, and accurate guidance, facilitating proactive decision-making and significantly reducing compliance risks.

How AI Chatbots Revolutionize Compliance

AI-driven compliance chatbots represent a major advancement in corporate compliance. They function as intelligent conversational agents designed to assist employees in navigating company policies, ethical dilemmas, and regulatory requirements. Powered by Natural Language Processing (NLP), these chatbots interpret employee inquiries accurately and deliver prompt, tailored responses. By integrating seamlessly into everyday tools such as Microsoft Teams, Slack, or corporate intranets, these chatbots become an intuitive part of employees’ existing workflows.

Consider an employee facing a potential conflict of interest scenario, unsure about the acceptability of receiving a gift from a vendor. Rather than delaying action, seeking colleague advice, or bypassing compliance protocols, the employee can privately consult the chatbot and instantly receive precise, policy-specific guidance. This immediate support increases compliance adherence and encourages a proactive, transparent approach to compliance matters.

Beyond quick access, AI compliance chatbots offer a critical advantage in consistency. Every employee receives uniform, accurate guidance, eliminating the risks of varying human interpretations or misunderstandings. These chatbots continually evolve, improving their responses by learning from past interactions and incorporating new regulatory updates and policy changes. This continuous learning capability ensures that the chatbot’s guidance remains relevant, accurate, and aligned with the latest compliance standards, ultimately promoting a robust and dynamic organizational compliance culture.

Strategic Insights for Maximizing AI Chatbot Value

Compliance professionals looking to leverage AI chatbots should consider the following strategic insights:

Define Clear Boundaries and Use Cases. Identify specific compliance areas where chatbots can add the most significant value, such as answering common HR policy questions, managing conflict of interest disclosures, or providing guidance on regulatory requirements. Establish precise limits to the chatbot’s scope to avoid ambiguity or misuse. Ensuring clarity in these boundaries helps employees understand when and how the chatbot should be used. This approach promotes efficient use and maximizes the chatbot’s effectiveness.

Prioritize Data Quality and Currency. Maintain high-quality, current information within chatbot databases by regularly updating them with the latest policy documents, regulatory updates, and procedural adjustments. Frequent reviews ensure that chatbot responses remain accurate and relevant. Outdated information can lead to compliance risks and erode employee trust in the chatbot. Consistent data updates reinforce chatbot reliability, ensuring employees receive correct and timely guidance.

Ensure Data Privacy and Security. Protect sensitive compliance inquiries by implementing robust data privacy and security measures. Employ stringent access controls, encryption standards, and secure storage solutions to safeguard employee interactions. Communicate these protections to employees to build trust and encourage open, honest dialogue with the chatbot. Data privacy and security are vital to maintaining employee confidence and regulatory compliance.

Manage Bias and Ensure Fairness. Regularly audit chatbot interactions to detect and address biases, ensuring fair responses for all employees. Biases in AI systems can unintentionally arise from underlying training data or model design. Conducting regular reviews helps identify and correct such biases, promoting fair and unbiased compliance guidance. A fair and impartial chatbot strengthens employee trust and ensures compliance advice remains universally applicable.

Establish Clear Human Escalation Points. Clearly outline scenarios where chatbot queries must escalate to human compliance officers. Define specific criteria, such as the complexity or sensitivity of the query, to determine when human intervention is required. Ensuring a smooth transition between chatbot and human guidance maintains a balance between automated support and expert oversight. This strategy helps prevent critical compliance issues from going unaddressed or mishandled.

Rigorous Testing. Conduct extensive pilot tests of chatbots using real-world compliance scenarios to identify and address potential knowledge or conversational gaps. Involve diverse employee groups in testing to capture varied interactions and unexpected questions. Thorough testing helps refine chatbot accuracy and responsiveness before broader deployment. This rigorous approach ensures reliability and user satisfaction upon full implementation.

Educate and Set Expectations. Launch chatbots alongside comprehensive communication plans clearly outlining chatbot capabilities, limitations, and confidentiality practices. Provide examples and demonstrations to help employees understand proper usage. Transparency about chatbot functionalities fosters realistic expectations and promotes trust in the technology. Effective education encourages regular and informed chatbot use.

Integrate Seamlessly into Workflows. Position chatbots within common communication tools and operational platforms that employees use daily. Ensuring easy, intuitive access encourages regular interaction with the chatbot. A seamless integration into familiar workflows significantly boosts employee adoption and compliance engagement. Such integration makes compliance advice readily accessible at critical decision-making moments.

Leverage Analytics. Use data generated from chatbot interactions to identify compliance “hot spots,” frequent misunderstandings, or unclear policy areas. Analytics provide valuable insights into employee behavior and compliance knowledge gaps. By acting on these insights, compliance teams can proactively refine policies, training, and communication strategies. Continuous analysis enhances overall compliance effectiveness and responsiveness.

Start Small, Scale Wisely. Begin chatbot deployment with targeted use cases or specific employee groups to validate effectiveness and build internal trust. Demonstrate initial successes to garner broader organizational support for expansion. Gradually scaling chatbot capabilities and reach ensures continuous improvement based on feedback and real-world experience. This cautious yet strategic approach maximizes chatbot utility and organizational impact.

The Future is Now: Chatbots in Action

After implementing their AI-driven compliance chatbot, Kimberly-Clark experienced a significant uptick in employee compliance inquiries. This surge highlighted a previously unmet demand among staff for immediate and easily accessible compliance guidance. Before the chatbot’s introduction, many employees hesitated to seek clarification on compliance issues because of uncertainty about whom to contact, embarrassment over basic questions, or the time-consuming nature of traditional communication channels. With the chatbot readily available, these barriers effectively vanished, creating an environment where employees felt empowered to address compliance concerns proactively.

This proactive engagement brought multiple benefits to Kimberly-Clark’s compliance program. First, the increased inquiry rate showed that the organization’s compliance awareness had improved dramatically. Employees who previously might have operated under assumptions or incomplete information were now seeking and receiving definitive guidance directly aligned with corporate policies and regulatory expectations. Second, it allowed compliance officers to identify areas of confusion or knowledge gaps, enabling more targeted and effective training programs and policy updates.

The chatbot’s data analytics provided Kimberly-Clark’s compliance team with valuable insights into employee behavior and compliance hotspots. Trends identified through chatbot interactions helped pinpoint frequently misunderstood policies or areas where additional clarity was needed. This intelligence empowered the compliance team to refine and streamline communications, enhancing overall compliance effectiveness proactively.

Ultimately, Kimberly-Clark’s experience underscored how integrating AI chatbots into compliance operations not only facilitates real-time, consistent guidance but also significantly strengthens the compliance culture within an organization. Employees transitioned from passively absorbing compliance information to actively engaging with it, reinforcing a shared responsibility for ethical and compliant behavior company-wide.

Navigating Challenges Thoughtfully

However, incorporating AI into compliance isn’t without challenges. Accuracy remains paramount; organizations must vigilantly guard against chatbot “hallucinations” or inaccurate guidance by implementing rigorous training, testing, and continuous oversight. Employee trust also must be nurtured, ensuring transparency about how chatbot interactions are logged and managed.

Data privacy, integration complexity, and regulatory compliance regarding AI use require careful planning. Compliance professionals must continuously assess and refine chatbot implementations to ensure these digital tools serve as trustworthy, valuable assistants rather than new sources of risk.

AI-driven compliance chatbots represent more than mere technological innovation; they symbolize corporate compliance’s proactive, integrated future. By embedding real-time, personalized compliance guidance into everyday business operations, companies can dramatically strengthen their compliance posture, mitigate risks effectively, and cultivate a robust culture of integrity.

Embracing these Chatbot tools thoughtfully, with a strategic approach to implementation and oversight, allows compliance professionals to move from reactive problem-solving to proactive risk prevention, ensuring ethical decision-making becomes a seamless, instinctive aspect of everyday corporate life.

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Compliance Tip of the Day

Compliance Tip of the Day – Using AI to Manage 3rd Party Risk

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 look at how compliance professionals can use GenAI to help manage third-party risk and consider the MasterCard example of how GenAI can help manage massive data sets for compliance.

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