I’ve probably interacted with more attorneys over the past couple of years than the rest of my entire previous life combined. Apparently all this fintech and regtech affects their jobs and the way they dream about their own futures. So I try to give them a little extra love. Uncertain times for them to be sure — and they should be concerned.
While we can argue that software code may or may not be any more human readable than a law, I see legal code and legal documents much like software programming.
It’s a set of instructions, hopefully logical, that tells people what to do, not do, prescribing action based on conditions or behaviors, etc…
I’ve addressed entire law firms that especially if you’re under age 40, as a practicing attorney, you’d better have at least a rudimentary grasp of code and data. Your next 20-30 year career will depend upon it.
Technology is rapidly moving the practice of law towards an automated process. The present trajectory is simply unsustainable.
I know a bunch of JDs are going to squirm when they read my previous statements, but after being in some form of legaltech, govtech, et al since the very beginning of my professional career, I am probably as close to the evolution as any senior exec in the field.
Automating Financial Regulation
The pinnacle is, in my estimation, automated regulation. That’s where we might have a BRE (business rules engine) and/or BRMS (business rule management system) that connects to related information systems and workflows as a form of governance.
Financial regulations could be written into supervisory systems that banks and other finserv’s simply plug into. Compliance could be built directly into automated processes and adaptation to regulatory change could literally become automated in real time.
Gosh, wouldn’t that be amazing?!?!?
In fact, we’re building a foundation for this future right this very moment.
Four Ways XDEX Could Help Transform Future Compliance
In my “Little Man Tate” inner space, where visual polygons spin around and source code brightly gleams like a Vegas neon sign against the insides of my eyelids, there are four key areas I see direct paths to a more verdant future for all this gobbledygook.
1) XDEX can enable more efficient methods of sharing information
Alternative regulatory reporting methods including data provision, collection and predictive analytics. Shared utilities via cloud or other online, on-demand platforms. Including capabilities that allow the banks, intermediaries, asset managers, law firms, auditors, advisors, exchanges, and FIs to communicate among each other, and also directly with the regulator in real time, thus eliminating the need for lengthy reviews and investigations.
2) XDEX could drive effectiveness by closing the gap between intention and interpretation
Over time, we will create and/or integrate data ontology standards to enable risk-theme based (e.g. credit risk, misconduct, cyber, fraud) regulatory interpretations, assessment and reporting at a real-time. Reduce / eliminate the need for post-trade surveillance and transactions monitoring including adoption of machine-readable and machine-executable regulations.
3) XDEX could help simplify data, allows better decision making and enable future cognitive automation
Alternative, secondary regulatory data architecture with APIs to enable simplified, real-time reporting and decisions. Cognitive automation enables reading and performing risk and compliance tasks. We can influence further change to simplify existing operating models.
4) XDEX could allow regulation and compliance processes to evolve differently, proactively, better
Holistic digital compliance including data integration, verification and visualization. Demand for integrated, utility based risk management and reporting covering a wide array of regulations, across both financial and non-financial risks.
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- XDEX – Bridging the Blockchain Gap With Metadata - August 10, 2020
- Is Automated Financial Regulation the Future? - August 8, 2020
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- Governance, Cryptocurrency’s Big Problem - July 28, 2020
- 10 Steps to Being Prepared for a Records Audit - June 11, 2020
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- What is Blockchain Consensus? - May 16, 2020