What is the Future of Finance? or is UBS a top performer?

 

 

“UBS never took enough interest in its risks”, Financial Times, 20.12.2012

 

Let’s start with the bad news – we did not win the Americas UBS Future of Finance challenge 2017. The good news is that we had the opportunity to pitch our RegTech vision and not less important, to get an inside look at UBS’s technology use (or lack of) in this field.

Our pitch was simple: you (UBS) need a regulatory compliance system (much like the one we’re currently offering for world laws – but much more advanced; a Smart system that can track, translate, map, compare and digest new regulatory change in less than an hour – globally. A learning system that will co-evolve with the bank systems and thus prevent future fines and minimize risk.

The justification was strait forward: according to a BCG recent report, the number of individual regulatory changes that banks must track on a global scale has more than tripled since 2011, to an average of 200 revisions per day. This is not a scale humans can handle efficiently. Hence it is no surprise that Banks paid $42 billion in fines in 2016 alone and $321 billion since 2008.

Technically speaking the Americas finals in which we participated were organized to the last detail. Though dietary options were not available (vegan, gluten-free etc.), the bank allocated relevant representatives to meet with each finalist and provide feedback on the pitch. For us these meeting felt like development meetings as the bank people offered great ideas to enhance our vision.

More importantly, it was an indication from a first-hand internal source that the bank (and other banks as well) is light years behind when it comes to RegTech and regulatory compliance. Given the bank spending in this field (in the billions) it is quite amazing and certainly was reassuring going to the pitching competition.

Inconveniently, while the mentoring session was held at the bank’s offices in Manhattan, the finals were held at the offices in New Jersey. This divide forced the candidates to move from one hotel to another and/or struggle with the massive transportation challenges that New York City has to offer.

With no expected diversity, the judges were all IT people. The America’s CEO Tom Natatil gave the opening speech but failed to stay for the actual competition. The judges were provided with feedback from the previous day mentors (ours was excellent) but did not provide any feedback or reasons for their choice of the winning pitch nor the 2nd and 3rd runners-up.

The winner, Authomate, pitched a mobile security system to allow the bank clients to log into the bank’s portal safely. While the technology may be new, this is by no means an innovative concept nor disruptive. Moreover, based on corporate logic, this will probably be the last technology UBS will adopt.

It is too early to say if the bank will be interested in our vision for the future. The same way that it was not clear whether the finalists were supposed to pitch a future venture that can be developed with the bank, or what they already have (Automate) to be used by the bank. Either way one thing was clear, as most big corporations, UBS structure is very fragmented and the chance to capture the attention of the relevant person is extremely challenging.

To summarize the experience, I would like to use the same citation I used at the end of my pitch: “Increasing regulation is here to stay – much like a permanent rise in sea level. In an era of rising regulatory seas, focus on management is mandatory, not optional. Top performers will use the opportunity to incorporate technical innovation” (BCG Report).

Whether UBS is a top performer is yet to be seen.

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Global-Regulation + RSA Archer = More Visibility into your Compliance Needs

Governance, Risk management and Compliance (GRC) platforms are the organization’s tool to help handle, among others, its regulatory affairs. This is what the RSA Archer® Suite is designed to provide through RSA® Archer® Regulatory & Corporate Compliance Management.

With most of the world laws (1.6 million laws from 90 countries translated from 30 languages) in English, in addition to complexity map and AI driven penalty identifier, Global-Regulation.com is positioned perfectly to complement the RSA Archer Suite.

This is the reason that Global-Regulation has a technology interoperability with RSA Archer Suite to offer customers an XML download of the world laws by Global-Regulation.com directly to RSA Archer Regulatory & Corporate Compliance Management, to empower customers to obtain better visibility into their compliance needs.

Now, with the launch of the RSA Archer Exchange available to RSA Archer customers, this technology interoperability can be even more seamless and easy than before.

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We’re on DuckDuckGo

Users can now run legislation searches directly from the DuckDuckGo search engine. We’re using “!laws“.

Just type “!laws climate change” in DuckDuckGo to be taken directly to Global-Regulation.com’s search results for “climate change”.

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Software That Reads Laws: PenaltyAI Search – Global Risk & Compliance Redefined

About a year ago I sat with my CTO in the Manhattan office of one of the world’s largest accounting firms. Their regulatory compliance global team was very impressed from what we’ve done so far with Global-Regulation and wanted to know what more we could do. As usual with large firms, they wanted a system that does everything – from tracking new bills to predicting the future (step 10 instead of step 3).
The ambition to create the ultimate risk and compliance system stuck with us. This ambition came into life when we realized, in one of our internal discussions about our global law search engine that penalties are the kind of information that can be identified with a high degree of certainty by an Artificially Intelligent system.

My story begins in the 2000s when I helped the Israeli court system work with IBM to digitize legal information. I’ve seen the slow evolution of legaltech and listened to the ambitious ideas of tech people. But I’ve also seen the reality of legal technology and wondered: how can we give machines the insight of lawyers?

Fast forward to 2017, after seemingly endless testing, experimenting, coding, consulting (thank you to Kyle Gorman from Google for the words to numbers converter recommendation) and hard work – we are extremely excited to present the PenaltyAI Search – the first and only AI system that identify compliance clauses in legislation on a global scale, extracts the actual penalties amount and serve it all to the user in US dollars.

Now risk and compliance professionals can search and identify risk levels across jurisdictions on a specific topic without even reading the law. Lets say that you are an IBM executive considering global expansion of your Watson services to new markets – with a click of a mouse you can now use the PenaltyAI Search feature of Global-Regulation to learn what would be the risk level of your goal.

Screenshot of PenaltyA Search for "tobacco nicotine"

Combine this with our complexity feature, suggested search ideas and related laws – and a risk & compliance team can feed Governance, Risk and Compliance (GRC) platforms with all the information needed to launch a new business line, in a matter of hours. Before, this would have taken months, require an army of translators and a division of analytics to determine risk and compliance.

We see this as a great achievement on several levels:

  1. an AI system that can really read legal text and produce useful meaning; and,
  2. enabling risk and compliance professionals to explore real and relevant data on a global scale, in English; and,
  3. allowing governments and businesses to assess and enhance their compliance efforts; and finally,
  4. for researchers to compare and contrast risk and compliance data globally.

Thank you big accounting firm for teaching us that even seemingly unsuccessful business meetings can bring great results. Thank you Microsoft Canada for your help in connecting us with the Microsoft Translator team. Thank you LegalX (now LawMade). Thank you Ken Thompson for UNIX and regular expressions. Thank you to my wife and children for your daily inspiration.

If you’d like to know more about how the system works technically, my CTO has written a blog post on building PenaltyAI Search.

Computers can now tell us about penalties for world laws.

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Microsoft Translator Case Study

After using MS machine translation (and some Google) to translate more than 750,000 laws and regulations from 26 languages, we are featured in a new MS Translator Case Study:
https://www.microsoft.com/en-us/translator/customers.aspx#textsearch=global-regulation.

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Search Ideas – Interaction with the Search Engine

What if you could discuss your search query with the search engine? well, now you can. Our new feature suggest search ideas based on the user’s query. These search ideas are extracted from our world’s laws database itself.

Here’s how it works:
1. We take the text of every law in the world and extract the most frequently mentioned word pairs, on a per-law basis. This way we create a new database of word pairs.
2. When someone does a search we check the database of word pairs and take the word pairs that occur most frequently in association with the word or word pair that the user is searching for. So a search for “coffee” will return keyword suggestions for words that appear in laws that mention “coffee” most commonly.
3. We then filter the words and take the best matches and display those to the user. These are the search ideas.

You can click on the search ideas in yellow at the top and it will be updated according to your recent search. For example, lets say you started with Coffee –> then you choose ‘Coffee Agreement’

And then choose ‘system certificates’. This is endless.

This new feature actually enable you to interact with the search engine and follow the trail that is based on the database of word pairs we created from our gigantic database of the world’s laws.

 

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Machine Learning – Text Analytics Comparison

As part of our work engaging Artificial Intelligence and especially Machine learning into Global-Regulation‘s system, we’ve conducted a comparison between the big four providers of ML Text Analytics: Microsoft, Google, IBM and Amazon. This post is a follow up of a previous post regarding AI assisted compliance system.

MicrosoftMS ML studio allow some options of text analytics.

screen-shot-2016-11-11-at-9-50-29-am

Although not particularly helpful for the purpose of identifying segments within legislation, MS ML studio

dn781358-mccaffreymls_fig1_hiresja-jpmsdn-10 is the most friendly system among the ML tools in this comparison. It is so friendly that even a user with minimal background in programming and ML can use it (with some patience and strong will 🙂

In MS ML There is a link to new text analytics models but unfortunately it is a broken link.

GoogleTensorflow offers some text analytics features. This is not a friendly tool and the text analytics options it does offer are vague. However, the vector representation of words may be useful when analyzing legal text and training a model to identify segments within legislation. This is a different approach than the structured text analytics offered by MS and IBM – see below.

screen-shot-2016-11-11-at-10-08-39-am

In the context of a previous post about AI assisted compliance system, Tensorflow vector representation may be the solution for the first part of the challenge, i.e., manually identifying compliance clauses and training the model with these clauses. Nonetheless, new challenges arises in the implementation stage since the system will be able to identify laws that includes compliance clauses but not the specific clauses within the law.

Overcoming this challenge will require an additional stage in which the laws may be broken into chunks of text before running the model to identify the clauses. As laws are not always (and usually not) machine friendly, this process creates its own challenges.

IBM – Now offered through AlchemyLanguage, IBM now have one text analytics feature analyzing entities and relevance. Before migrating the text analytics features in July 2016, IBM offered few options of text analytics that are not available now.screen-shot-2016-11-11-at-10-20-11-am

This system analyze factor as ‘Fear’, ‘Anger’ and ‘Joy’ – not exactly what one would need to analyze legal text. In addition, IBM’s costumer service does not really work. Attempts to get access to their system failed even after stubborn emails.

Finally, it should be mentioned that Amazon’s ML platform  does not provide any text analytics options.

Conclusion

One would expect that the first step in analyzing legal text would be to use ML text analytics options. This seems like the short way towards identifying segments within legislation and the best way to ride the advancements in this field. However, upon testing these ML text analytics abilities, it becomes clear that this is not the answer and that in their present state of development, ML text analytics is not capable of doing much serious work, rather than classifying text as ‘Joy’ or ‘Anger’.

The more ‘simplified’ approach taken by Tensorflow vector representation is much more relevant for the purpose of analyzing legal text and identifying segments in big data even though it is far from the ‘Watson Dream’ where you ‘work with Watson’ and get your text analyzed with the click of the mouse.

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Related Laws Feature

We’re pleased to announce that our “Related Laws” feature is now generally available (and fast). When users click the “Related Laws & More Info” button next to each search result there will automatically be a list of related laws generated and shown (where applicable – short laws don’t have this feature because the results aren’t useful).

This feature was previously available and marked as “experimental”. With recent upgrades to our database system we’ve improved the speed of this feature by 15x and can make it widely available to everyone (including users who are not paid subscribers). This is one part of our strategy for making the search experience faster and more useful.

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Recently Added Countries

We’ve added a few new countries:

  1. Uruguay
  2. Moldova
  3. Turkmenistan
  4. Norway
  5. Greenland
  6. Madagascar
  7. Malaysia
  8. Greece
  9. Guyana

Photo by John Seb Barber.

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New Global Law Search Engine Built With Microsoft Azure and Bing Translator Will Exhibit at AALL 2016 Convention, July 16-19, Chicago, IL

June 20, 2016 – Global-Regulation Inc. announced today that the first public demonstration of its new global law search engine will be at the American Association of Law Librarians annual convention to be held at the Chicago Hyatt Regency, July 16-19, 2016.

Global-Regulation Inc., through its website at www.global-regulation.com, provides the largest comparative search engine of laws, regulations and technical standards from around the world with more than 1.3 million laws from 50 countries.

The AALL convention is the largest convention for legal information professionals, attracting thousands of law librarians from across the world.

The Global-Regulation.com platform leverages Microsoft Azure and Bing Translator APIs to scan millions of laws and translate them into English.

Global-Regulation’s law search engine is already being used by Harvard, Oxford, NYU, KPMG and dozens of other leading institutions and government agencies.

“No one has done this before. We are bringing the world together by making the global legal system easily accessible,” says Global-Regulation’s CEO Nachshon (Sean) Goltz. “We are both excited and proud towards our first public exhibition and would like to thank Microsoft Corp. for their support.”

Nicole Herskowitz, senior director of product marketing, Microsoft Azure, Microsoft Corp. said, “Global-Regulation.com has harnessed the combined capabilities of the Microsoft Azure cloud platform and Bing Translator to bridge gaps between languages and cultures in order to make the world’s laws accessible to people across the globe.”

 

For more information contact:

Nachshon (Sean) Goltz, Global-Regulation Inc., (647) 963-3470, ngoltz@global-regulation.com

Note to editors: If you are interested in viewing additional information on Global-Regulation Inc. please visit http://www.global-regulation.com.

 

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