Speed, Accuracy and Efficiency: Artificial Intelligence & Regulatory Compliance


When a financial institution wants to do business with a customer, it’s not a simple process of shaking hands and signing some documents. Federal law requires financial institutions to “know their customer” thoroughly prior to transacting business. And that’s often when the financial institution calls KPMG — a leading audit, tax and advisory firm — to assist with what is commonly known as the client onboarding process, which is inclusive of the multitude of regulatory requirements like Know-Your-Customer, Anti-Money Laundering, FATCA and the Common Reporting Standards to name a few.

The challenge financial institutions face is that while the business world operates at Internet speed, client onboarding has been mired in tedious, manual paperwork for decades. Meeting a given rule within a regulation alone can take hours upon hours of work, and a financial institution may have to satisfy hundreds of regulations, with thousands of underlying rules. Historically, financial institutions have addressed this with traditional increases in staffing levels, tracking of paper documents and, more recently, leveraging offshore lower cost labor, and finally, workflow technologies. All of these tactics have plateaued and, marginal enhancements notwithstanding, this industry process is ripe for a sea-change transformation.

KPMG approached this challenge by considering the expanse of data that financial institutions need to manage in their onboarding decision process. Recognizing that manpower and workflow technology alone have not delivered significant efficiencies and improved compliance, KPMG invested in developing and deploying an artificial intelligence-based managed services solution aimed at increasing the accuracy, efficiency and timing of institutions’ onboarding processes.

At the core of the solution rests MarkLogic’s Enterprise NoSQL database platform, which has a schema-agnostic data model that ingests data regardless of format. As a result, KMPG can analyze both structured (e.g., data feeds from front office systems, W-9 forms, etc.) and unstructured (e.g., articles of incorporation, annual reports, e-mails, etc.) data seamlessly. Traditional relational databases, while useful for some purposes, are not designed to handle this volume and complexity of onboarding and customer reference data. To further characterize the data challenge, it is estimated that approximately 60 percent to 70 percent of customer reference data information that financial institutions work with is unstructured data.

Result? KPMG’s client onboarding managed service solution is driving process efficiencies and cost savings across its portfolio of clients consisting of global and domestic banks, insurers, and asset managers.