Can RegTech Innovation help flag key warning signs of imminent violence?

Is it time to explore applying existing technologies in RegTech and AML to seemingly intractable social-violence problems?

The Uvalde school shooting was yet another horrific and unimaginable act of violence in the U.S. And that particular kind of horror has been categorized by some as “social violence”—a type of event whose traits often include signals pointing toward and even previewing the violent events. Given the many red flags tied to many acts of social violence, might innovations in RegTech be applied to tracking and flagging these devastating events?

First, let's start by defining what social violence means. According to various sources, social violence is any action taken by a human that results in a physical or emotional violent reaction. This would include actions like suicide, mass shootings, and human trafficking—events that usually include substantial planning.

For the last 20 years, I've dedicated my work life to trying to define and recognize human behavior as it manifests in transactional data that predicts financial crime. Specifically, in AML/KYC we look for illicit behavior, unwanted behaviors, and suspicious behaviors that we know may be predictors of financial crime in the international banking system.

Enter the new emphasis known as ESG—environmental and social governance. For this message, I'll only really be referring to the social aspect of ESG. I want to converge certain social aspects of ESG with GRC (Governance, Risk, and Compliance) essentially to risk-rate concerning behaviors online and in other public spaces (violence-predicting law-breaking, etc.). Automated tracking for red flags—without using any Personally Identifiable Information, or PII—could facilitate clearer and earlier recognition of impending social violence and help prevent it.

Anonymized monitoring of online posts is a crucial place to start. If we understand and monitor for the social-violence precursor behaviors online, we could better predict when and where social violence may occur. Many perpetrators of social violence these days preview their intentions first online—often multiple times and to multiple audiences. If we look at the recent school shooting in Texas, the perpetrator posted online what he was going to do 15 minutes before he did it, and he had many other concerning online behaviors, too.?

Because of tremendous innovation in AML and GRC technologies and highly-developed monitoring strategies used to flag potential financial crime, we have the technology to detect and report red-flag behaviors in less time than it would have taken that perpetrator to drive to the school to commit his atrocities. And it’s not just that type of perpetrator violence. This type of monitoring could be tuned to flag high risk of suicide or susceptibility to human trafficking. Thanks to innovation in fighting financial crime, we have the capability to predict this when it happens and to get these people help--before the violence happens.

To be clear, I'm not advocating for some kind of Orwellian Big-Brother monitoring of individuals. The monitoring aspect of this would only be looking at what is called metadata. No Personally Identifiable Information (PII) would be used in the analysis. By looking only at the metadata, we could see the predictions of social violence, and we would notify the correct mitigator of that violence—human services, the police, or whoever.?

To achieve this type of metadata monitoring would require a collaboration of a GRC platform and an ESG platform to integrate both sides and to ensure that the handoff between all the stakeholders and all the metadata happen seamlessly every time. Not a simple task. But it's one that I think we need to consider to in order to decrease these all-too-frequent events of horrific social violence.

Justice Department implements policy of personal liability for Chief Compliance Officers and CEOs in settlement agreements

A Wall Street Journal article yesterday caught our attention here at AML Partners. A relatively new policy from the Justice Department will require Chief Compliance Officers and CEOs to sign personal certifications attesting to effective Compliance improvements mandated in settlement agreements. The first use of the policy is in the recent Glencore agreement to pay a $1billion+ fine and improve their Compliance systems in order to prevent future failures.

The Justice Department rationale is that CCOs will gain status and leverage if a firm must get their signature and certification related to settlement-related Compliance improvements. But some analysts worry that this new policy puts CCOs in even worse positions. To read more, visit our company blog at this link.