The importance of governance in artificial intelligence and machine learning technology

Stacey Chieng and Sourit Dasgupta
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Stacey Chieng: Chief Anti-Money Laundering Officer, Interactive Brokers, USA
Sourit Dasgupta: Global Head of Model Risk and Analytics, Interactive Brokers, USA

Journal of Financial Compliance, 2025, vol. 9, issue 2, 116-125

Abstract: Financial institutions increasingly deploy artificial intelligence (AI) and machine learning (ML) solutions to enhance compliance processes. While this trend promises significant efficiency gains, it also introduces complex governance challenges that compliance executives must effectively address. Drawing on regulatory developments, technical considerations and industry best practices, this paper presents the process to develop a comprehensive governance framework for mitigating risks associated with AI/ML implementation in compliance functions. This paper concludes with a forward-looking perspective on evolving governance requirements as AI/ML technologies continue to transform financial compliance. This article is also included in The Business & Management Collection which can be accessed at https://hstalks.com/business/.

Keywords: financial crimes; artificial intelligence; AI; AI governance; governance; compliance; AML; anti-money laundering; AI policy; machine learning; AI/machine learning; ML; AI and ML (search for similar items in EconPapers)
JEL-codes: E5 G2 K2 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:aza:jfc000:y:2025:v:9:i:2:p:116-125

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