Background
A leading cross-border payment infrastructure provider recognized the need to enhance its fraud detection systems by integrating AI capabilities. This is due to the increasing sophistication of financial crimes and the high volume of transactions across borders. By incorporating AI into their fraud detection models, the provider aims to leverage advanced machine learning algorithms to identify and mitigate fraudulent activities more efficiently and accurately. Committed to upholding the highest regulatory compliance standards, the company aimed to ensure that its AI model for anomaly scoring aligned with emerging AI regulatory standards and effective model management. Our independent review, conducted in adherence to rules and international standards, offers valuable insights into the client's anti-fraud detection model.
How We Helped the Client
We leveraged our expertise in navigating complex model risk frameworks and conducting meticulous validations. Our proven track record of assisting clients in enhancing their model predictive powers by adopting AI/ML approaches extends to improving clients' risk frameworks, ensuring compliance with regulatory requirements, and providing support in areas like KYC/AML, Model Risk Governance, and Risk Operations.
To assist the client, a framework review was conducted to evaluate compliance against reference standards aligned with industry and supervisory AI Model Risk standards. The assessment included a comprehensive evaluation against regulatory benchmarks such as ISO/IEC 42001, SR 11-7, and SS 1/23, among others. Subsequently, key components of the model were tested using third-party software to measure its effectiveness with precision.
The combined compliance validation and precision testing efforts resulted in a comprehensive assessment report detailing the compliance status of the client's AI applications. Identified gaps were addressed with a roadmap for effective remediation.
Business Impact
The strategic collaboration between Evalueserve and the leading global cross-border payment infrastructure provider highlights the importance of managing the complexities of emerging AI regulations in financial services and beyond. This partnership underscores our expertise in assisting clients and providing them with crucial insights to navigate these challenges. Much remains to be explored in this area, reflecting the growing need to develop compliant AI implementation strategies.
Our independent review, conducted in adherence to regulations and international standards, offers valuable insights into the client's antifraud detection model. This examination highlights gaps within the model, prompting the development of targeted remediation strategies to ensure compliance. By aligning with regulatory frameworks, software providers bolster their integration into financial institutions' systems and foster stakeholder trust regarding model reliability.
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Overview & Impact
Evalueserve helped a leading cross-border payment infrastructure provider in assessing model risk and AI frameworks. Our compliance validation ensures regulatory adherence, fostering stakeholder trust.
Independent Review Against Regulatory Benchmarks
Targeted Remediation Strategies
- Improved Index Management Process
- Increased Efficiency Through Automations