Legal technology is constantly being fine-tuned and enhanced. This requires companies to stay abreast of the changes, before they fall into legal hot water. Regulatory technology (RegTech) is designed to replace manually created legal language with AI and coding. This facilitates legal departments and corporate counsel in staying compliant and in line with regulatory & compliance measures.
Regulatory technology includes the monitoring and tracking of regulations and compliances. RegTech processes information and data from various sources, analyzes the data, and offers insights, tech-powered predictions outlining risks if any, and proven strategies.
Integrating RegTech offers management of ever-changing regulatory and compliance measures. It further minimizes and mitigates risks due to non-compliance. The RegTech softwares include Artificial Intelligence (AI) and Machine Learning (ML) to capture relevant data in an organized manner, and to offer predictive analytics for legal departments and corporate counsel.
RegTech in Anti-money Laundering
Financial crimes can be identified and eliminated by using RegTech. In the case of anti-money laundering (AML) measures, RegTech identifies, streamlines and improves efficiency on all AML compliance and fraud prevention methods. Advanced AML RegTech uses predictive analytics, automation and AI to prepare in-depth insights and offer fixes.
According to a Bloomberg article on RegTech, the RegTech market is poised to be worth $16 billion by 2025. This includes AML compliance software that monitors money laundering activities at companies, and identifies them in time.
With RegTech, legal departments and corporate counsel can get
- Faster and thorough insights
- Exponential cost-savings
- Increased efficiency
- Risk mitigation
International transactions come with their own set of issues. Being compliant is key, and one of the compliance measures that companies need to abide by are the OFAC Sanctions. OFAC Screen and Search is a procedure that companies must abide by, to ensure that individuals and companies they’re transacting with aren’t on the OFAC’s watch list.
Being aware of, and adhering to sanctions like OFAC’s – by not transacting with companies and individuals on watchlists is vital to ensuring that fines or other measures are not imposed. A Forbes prediction on RegTech notes that hefty fines are a major risk to institutions when they do not comply with the sanctions list. This makes utilizing artificial intelligence (AI) via RegTech extremely important, to avoid fines and further legal complications.
With RegTech, legal departments and corporate counsel can save big on compliance process costs. It also improves the efficiency of workflows and subsequent delivery, making these processes faster and far more reliable.
The unique way in which RegTech software can pull up data and analyze it helps companies stay compliant and in line with compliance and regulatory measures.