Phoenix Financial Consultants: Automating compliance monitoring to enhance consumer protection

Project Overview

Fifty One Degrees has been engaged to build an innovative generative AI-powered website and social media monitoring agent for Phoenix Financial Consultants. Phoenix operates a point of sale and buy-now-pay-later financing platform, but also acts as principal in an introducer appointed representative relationship with over 700 firms that use it’s platform. The primary aim of this project is to ensure these firms are compliant with FCA guidance, thereby reducing regulatory risk and enhancing consumer protection.

Project Objectives

1. Enhancing Efficiency

The project aims to reduce repetitive tasks for the compliance monitoring team by at least 50%. By automating these tasks, the team can focus on more strategic activities, thus improving overall productivity and efficiency.

2. Comprehensive Monitoring

Another key objective is to monitor 100% of websites and social media weekly, as opposed to a lower frequency achievable through manual monitoring. This comprehensive monitoring approach is designed to significantly reduce regulatory risk and increase consumer protection.

Solution Design

To achieve these objectives, the generative-AI-powered tool will:

Automated Reading

Read IAR websites and social media on a chosen frequency, such as monthly. This automation ensures that no content is missed and monitoring is consistent.

Compliance Review

Review IAR websites and social media for restricted activities and promotions under FCA rules. This includes identifying any content that does not comply with regulatory requirements.

Exception Reporting

Report exceptions via email or another appropriate medium. This ensures that the compliance team is promptly alerted to any issues, allowing for swift action.

Technology Deployment

The solution leverages cutting-edge technologies to deliver robust compliance monitoring:

Python Application

The core application is developed in Python and will be hosted by the client. It integrates seamlessly into the client’s existing proprietary technology stack, ensuring smooth operation and minimal disruption.

Custom built RAG module

A retrieval augmented generation (RAG) module is custom-built for this project. The module is built around a vector store, which enables efficient data retrieval and analysis.

Integration with LLMs

The solution integrates with a large language model (LLM), initially using OpenAI. Testing has also been conducted with other models such as Claude and Mistral, ensuring flexibility and future-proofing the solution.

Anticipated Impact

By implementing this generative AI-powered monitoring agent, Fifty One Degrees anticipates several key benefits:

Efficiency gains

Significant reduction in manual tasks for the compliance team, freeing up resources for more strategic initiatives.

Improved compliance

Enhanced ability to monitor and ensure compliance with FCA rules, thereby reducing regulatory risk.

Consumer protection

Better monitoring translates to improved consumer protection, as non-compliant activities are swiftly identified and addressed.

Conclusion

Fifty One Degrees’ engagement in building this generative AI-powered compliance monitoring solution for Phoenix Financial Consultants demonstrates a commitment to leveraging technology for regulatory compliance and consumer protection. This project not only aims to enhance operational efficiency but also to ensure that compliance monitoring is thorough and consistent, ultimately safeguarding both the client and their consumers.

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