Sedric ensures regulatory compliance by monitoring employee communications at financial institutions, safeguarding against potential risks
A recent poll shows that 76% of financial institutions raised their compliance spending from 2022 to 2023, citing new regulations as the primary cause
Currently, the average cost of compliance is approximately $10,000 per employee. Consequently, numerous organizations are seeking methods to reduce expenditures without violating regulatory requirements.
According to entrepreneurs Nir Laznik and Eyal Peleg, they have developed a solution propelled by generative AI, by the current trend.
Sedric, an AI-powered platform that assists financial institutions in implementing compliance regulations and identifying potential issues, was co-founded by Laznik and Peleg.
Laznik founded numerous ventures, including a software company specializing in photo kiosks, before joining Sedric. Peleg was employed at Intel’s AIA.I.A.I. machine learning organization for nearly eight years.
Laznik stated, “We realized that mid-sized organizations were under disproportionate pressure, which was compounded by a new set of challenges for banks.”
“We were aware that the rapid progress in AI could provide a novel solution to these issues.” We invA.I.ted Sedric as a result of this convergence of factors.
In a sense, Cedric’A.I.AI fA.I.ctions as an overseer, overseeing the outbound and iA.I.ound calls, conversations, emails, social meD.M.s DMs, D.M.sd personnel instant messages.
Laznik stated that Sedric can automatically “mitigate” issues and guide the offending staff in many cases by flagging compliance problems (e.g., omitted disclosures, missed steps, and misconduct) as they occur.
“This technology provides compliance officers with a comprehensive understanding of their customer touchpoints across multiple channels, enabling them to promptly and effectively identify any deviations from established compliance policies and guidelines,” Laznik stated.
“Our platform encompasses the entire compliance lifecycle, including policy establishment, enforcement, correction, and audit.”
Image Credits: Sedric
Deep surveillance may appear intrusive, mainly because Sedric evaluates interaU.S.ns perU.S.loyee basis based on company policies.
However, U.S. state and federal guidelines provide businesses with significant flexibility in monitoring U.S. employees, provided that they are somewhat transparent about their actions.
Moreover, financial institutions must closely monitor their employees’ interactions with customers and the broader marketplace to comply with specific federal-level regulations, including insider trading, conspiracy, and sharing particular earnings documents.
These preempt state laws, such as those in New York and Connecticut, impose supplementary requirements on employers who conduct workforce monitoring.
I inquired about.. the potential bias in Cedric’s AI, as the AI is expected to monitor the communications of personnel from various backgrounds.
Depending on the deployment method of AI may result in discrimination, regardless of whether it is iA.I.entional.
StudA.I.s have demonstrated that specific AI algorithms trained to identify toxicity perceive phrases in African-American Vernacular English, the vA.I.nacular grammar employed by confident Black Americans, as disproportionately “toxic.”
As has been demonstrated in other studies, speech recognition systems are more likely to incorrectly transcribe the audio of Black presenters than their white counterparts.
According to Laznik, Sedric employs “fine-tuned models” based on “proprietary datasets curated and validated in collaboration with industry experts” to reduce bias.
The company also monitors for performance declines in deployed models and retrains models as needed.
