AI Monitoring Helps Financial Firms Stay Law Abiding

In the world of financial services, maintaining integrity and trust is crucial to the industry’s compliance and regulatory demands. And how a company’s personnel conduct themselves professionally can have dramatic ramifications.

Shield, a global regulatory technology company headquartered in Ramat Gan, is currently revolutionizing the way large financial organizations monitor and analyze their internal communication channels. 

The Ramat Gan-based firm has developed an artificial intelligence-powered platform designed to detect and prevent issues such as misconduct and market manipulation through real-time monitoring and sophisticated analysis of employee communications, ensuring they remain compliant with stringent regulatory standards within the financial services industry. 

“Information breaches can lead to very complex internal and external issues for companies,’ Iftach Drori, VP Marketing for Shield, tells NoCamels.

According to financial compliance specialists Fenergo, in 2023 alone, companies worldwide were fined a total of $6.6 billion for failing to comply with standards on anti-money laundering; client verification; environmental, social and governance; sanctions and customer due diligence.

Shield’s platform leverages advanced AI to provide comprehensive communication compliance and surveillance, capturing and analyzing data from more than 100 sources, enabling proactive risk management, efficient eDiscovery and robust supervision.

The platform’s multilayered AI and semantic analysis offer transparent, contextual insights, significantly reducing false positives and ensuring regulatory compliance across various communication channels.

By analyzing the data it receives, Shield’s system lets compliance teams meet their legal obligation to fully investigate potential breaches. 

“This capability is crucial in an era where organizations face considerable fines for inadequate monitoring of business communications,” says Drori. 

“During the last couple of years, financial organizations faced over $2.5 billion in fines for not monitoring business communications such as WhatsApp,” he says. 

The company uses GenerativeAI (or GenAI), a subset of artificial intelligence focused on creating content, analysis and solutions beyond its explicit programming. GenAI can also understand, learn and generate actions based on complex patterns and data. 

Shield has integrated GenAI into its operational system in several ways, helping companies to better understand the context of personnel communications. 

This means that the platform can discern nuances in language, sentiment and intent, which is crucial for detecting potential misconduct or compliance breaches that may not be evident through a simple keyword match.

Shield’s algorithm analyzes and interprets data from communications across multiple channels, including emails, instant messaging and voice calls. 

“Such a comprehensive approach allows adherence to the industry standards on the part of compliance officers,” Drori explains. 

He says that based on historical data and ongoing communication patterns, Shield’s AI platform can predict future patterns of employee behavior or other risks.  

“This approach not only helps our customers stay ahead of regulatory compliance requirements and potential threats, but also turns this crucial data into a revenue engine,” he explains. 

Furthermore, integrating GenAI allows Shield to continually improve its surveillance models, adapting more swiftly to new communication technologies and evolving regulatory landscapes, thereby ensuring that its monitoring capabilities are always up to date. 

Drori explains that this comprehensive oversight and accuracy sets the company apart from its competitors. 

“By monitoring and analyzing over 100 million daily interactions in one organization, we empower large financial institutions to manage risks associated with communication channels,” he says.

Shield says its multi-layered approach not only enhances adaptability but also seamlessly integrates AI advancements, reinforcing its position as a leader in safeguarding financial integrity through advanced technological solutions.

“Our responsible AI system helps ultimately build trust in AI-driven solutions within the financial sector,” he adds.

The platform can be integrated in existing data security systems, providing real-time alerts that are essential for regulatory compliance, IT and surveillance teams. 

‘This adaptability has brought about many of Shield’s customers today”,” Drori says. 

Founded in 2018, Shield was self-sustaining for the first three years and only in 2022 was bolstered by $35 million in Series A and B funding rounds. 

“Startup life is a rollercoaster,” Drori says, explaining that Shield now has multiple big name clients, although divulging them is not possible due to privacy policies.  

He says that the reliability of the Shield algorithm and its successful operation have not only won the company its own recognition, but also helped build confidence within the financial sector when it comes to AI-driven solutions.

Since its inception, Shield says the platform has gathered recognition for its approach and positive results in the market. Drori says he cannot divulge the names of the company’s clients due to regulatory restrictions but asserts that many are global household names. 

He explains that Shield is hoping to further innovate by expanding its AI capabilities and enhancing its surveillance models. 

“By staying at the forefront of technological advancements, Shield wants to fortify its position as a trusted partner for financial organizations worldwide,” Drori says. 

The company also remains steadfast in its mission to uphold integrity, trust and compliance through responsible and innovative AI development.

“Shield was given this name on day one, and I think Shiran [Weitzman, the company’s CEO] picked the name because it felt as if we were shielding our clients from safety issues – and that is exactly what we are aiming to do,”’” Drori says. 

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