Clausematch Releases Knowledge Graph to Drive Digitization of Regulation with the Use of AI

Clausematch, a technology company developing solutions for regulatory compliance, announced it has released the digital knowledge graph in open source. Regulators and financial services companies now have access to test the graph and see how regulation in a structured digital format works. The AI developments carried out by Clausematch underlying the release of the knowledge graph fundamentally transform the approach to the very understanding of regulation and how it can be delivered.

Clausematch has been involved in a series of projects in this domain with financial services regulators since 2019. Thus, the FSRA of ADGM launched proofs-of-concepts in the digital regulation field where Clausematch was working on knowledge graphs and API-enabled rulebooks digitising ADGM’s crypto regulation. The joint team reimagined the regulatory framework by taking the content of regulatory requirements, automatically categorising them using advanced AI models, creating tags focused on regulatory concepts, obligations and expectation.

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With the digital regulatory rulebooks, financial institutions will be able to gain a deeper contextual understanding of the current applicable legislation and apply requirements more effectively and efficiently. The knowledge graph will become a source of digitised rules available for the use of decision automation systems. With the help of AI models, the knowledge graph will extract the understanding of regulations and embed it in a structured, dynamic, machine-executable form. Eventually, this will enable more institutions and firms to foster greater governance practice and transparency in their daily operations being compliant by design.

Speaking on the collaboration, Evgeny Likhoded, CEO and Founder at Clausematch, said: “Regulators need to become active advocates of a new structured approach to regulatory texts. When regulations are digital, it gives a tremendous advantage and capability to businesses to achieve an entirely new level of compliance and transparency. We have been working on these developments since 2019 and we are proud to be releasing the results in an open domain as this can take the industry forward much quicker. Working with regulators and financial services institutions, we are committed to continue to innovate and take compliance to the next level. The more regulators align with this vision of structured machine-readable regulations, the faster we can propel the industry to improve and significantly reduce the cost of compliance.”

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It is well known that AI systems can process large amounts of data. The number of processes is increasing and growing. It is necessary to automate the deep analysis of content produced by both parties: the regulators and the regulated firms. By training AI for rule interpretation tasks we can capture the understanding, the very meaning of regulation out of people’s heads and put it into digital form so that it can be copied and reproduced an unlimited number of times.

Digitizing regulation provides unparalleled advantages to consumers and businesses, helping to meet changing requirements and improve efficiency.

To highlight this development and its impact, Clausematch also published a scientific paper on the application of knowledge graph technologies for regulations.

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