AI for Regulatory Compliance in Banking: From SOX to Real-Time Monitoring

According to BizTech Magazine, SOX tasks such as controls testing and audit preparation are often handled through spreadsheets, disconnected systems and labor-intensive reviews, a model that is increasingly difficult for midsize banks to sustain.[1]The magazine reports that AI-enabled platforms can automate controls testing, generate audit-ready documentation and continuously analyze operational and transaction data to detect risk.[1] BizTech says that banks with between 500 and 5,000 employees[1] can use these tools to grow compliance operations without hiring more staff.One source, identified as Abadir, told BizTech that "the future SOX auditor works from risk signals across entire data sets rather than from static samples."[1]BizTech reports that Taylor, another source, says AI can track regulatory publications and enforcement actions and link changes to internal controls to compress response cycles from months to days.[1]According to the magazine, Taylor says banks can measure return on investment through reductions in audit preparation time, fewer manual compliance tasks and faster access review cycles.[1]Abadir also warned BizTech that programs treating "going live" as the finish line "often encounter examination issues and fail to capture the operational savings that justify the investment."[1]In separate analysis, Grant Thornton says that external auditors and regulators have not given blanket approval for AI-driven SOX compliance[2]. The firm adds that most organizations are not yet using AI in SOX compliance, due to skills gaps.[2]