This week’s COMPLY episode is part 1 of a discussion between John Zanzarella, PerformLine’s CRO, Ed Vincent, CEO of Lumio, Kunal Datta, Head of Product at Unit21, and Anna Fridman, Co-Founder of Spring Labs, as they take a deep dive into the transformative impact of AI on RegTech, exploring how AI-driven solutions are redefining compliance strategies for financial institutions.
This episode highlights:
- RegTechs are evolving to meet rising compliance expectations, offering faster and smarter AI-driven compliance solutions.
- Financial institutions are adopting proactive, data-driven strategies to strengthen compliance and stay ahead of risk.
- AI and automation are transforming scale by boosting efficiency and enabling smarter risk management.
Show Notes:
- Connect with John Zanzarella: https://www.linkedin.com/in/johnzanzarella/
- Subscribe to PerformLine to stay connected to resources and updates: https://lp.performline.com/subscribe-to-performline
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About COMPLY: The Marketing Compliance Podcast
The state of marketing compliance and regulation is evolving faster than ever. On the COMPLY Podcast, we sit down with the biggest names in marketing, compliance, regulations, and innovation as they share their playbooks to help you take your compliance practice to the next level.
Episode Transcript:
Jessica:
Hey there COMPLY podcast listeners and welcome to this week’s episode. This COMPLY Podcast episode is Part 1 of a discussion between John Zanzarella, PerformLine’s CRO, Ed Vincent, CEO of Lumio, Kunal Datta, Head of Product at Unit21 and Anna Fridman, Co-Founder of Spring Labs, as they take a deep dive into the transformative impact of AI on RegTech, exploring how AI-driven solutions are redefining compliance strategies for financial institutions. So I’m going to kick it over to Ed Vincent to get the conversation started.
Ed:
I appreciate everyone taking the time. I know it is a busy week in particular, but we’re excited to dig into this hopefully pretty meaty topic here today.
As mentioned, I look after the business at Lumio Solutions. We are a risk and data management platform that is designed to empower community financial institutions to enact risk-informed decisions. So think of business intelligence and kinda AI-enabled data in the hands of those folks in the first line out in the business.
We’ve got three learning objectives today in areas that we’re going to explore.
Number one, How do RegTech Solutions, how are they redefining compliance strategies for banks and credit unions?
Number two, practical approaches to solving compliance challenges with technology. So we’re gonna get into a handful of specific use cases here.
And then number three, we’re gonna talk a bit about emerging trends that are gonna shape the future of compliance technology.
I have got a fantastic set of panelists here with me here today. I will give them a quick intro and then ask them to grab the baton and talk a little bit about their businesses and their background and then we’ll get right into the conversation.
Anna Friedman is the co-founder of Spring Labs and Anna is a former Chief Compliance Officer as well as someone wearing a general counsel hat today. So, Anna is particularly well qualified to apply on the topic at hand. Anna, will you?
Anna:
I don’t know about that, but okay.
Ed:
Well, we’ll see! We’re going to put you on the hot seat. We’re going to figure that out! But why don’t you share a little bit more on your background, if you would.
Anna:
Sure, Ed, thank you so much for the intro. Too generous. So as Ed mentioned, I’m co-founder of Spring Labs. We focus on AI-powered process automation of the backend of financial institutions. So our leading product is an AI-powered complaints and customer feedback management system that helps customers much more efficiently tag their complaints, organize them, categorize them, and create the scaffolding for responses to customer feedback. So just making the process a lot more efficient every step of the way.
Ed:
So a real meaty topic that we’ll unpack those customer complaints issues in a few minutes. John Zanzarella is the Chief Revenue Officer at PerformLine. John’s got deep experience around customer acquisition. It’s not a way of me calling you old though, John, to be clear. But it’s certainly an area where compliance is key, right?
And now you’re leading the charge at the only omni-channel sales and marketing compliance provider out in marketplace. So John, will you share a little bit more on your background, as well, please.
John:
Yes, we’ll do. Thanks, Ed. I’m the Chief Revenue Officer here at PerformLine. I’ve been with the company a little over eight years. And during that time, we’ve supported some of the world’s largest and fastest growing banks, fintechs, credit unions, with an automated omni-channel solution for sales and marketing compliance oversight. So that includes helping automate the approval of sales and marketing content before it goes to market.
As well as, the ongoing monitoring and discovery of our clients customer communication channels. So web, email, social media, calls and messaging, looking specifically for any potential brand or regulatory risk.
Ed:
Thank you very much for joining us. Great to have you.
And last but certainly not least, Kunal Datta is the head of product at Unit21. Kunal, you began working in the AI space seven or eight years ago, well before it was cool. So you’re a trendsetter there. And now you’re bringing that experience to Unit21 where you guys are focused on lowering fraud loss and streamlining AML compliance. So, I’ll pass you the mic and ask you to share a little bit of your background and then we’ll jump into the meat of today’s conversation.
Kunal:
Yeah, absolutely. And thank you for having us, having me here today. So Unit21, for those who aren’t familiar, we work with banks, credit unions, fintechs of all shapes and sizes, crypto companies, really across the board, specifically for anti-fraud and then anti-money laundering. We have a bunch of different products, things like real-time rules, and, real-time rules engine, device intelligence, transaction monitoring, case management, customer risk ratings, the whole gamut around AML, as well. And then more recently, you know, over the past few years now, we’ve been experimenting with it, but recently been launching a bunch of products around AI agents to actually automate manual workflows. So this is, you know, if you have a team of let’s say 10 people doing manual alert reviews, you can do the same number of reviews now with one person.
That’s really what it is. We recently launched also detection agents on that side, so like rule recommendations using AI and really, AI across the board to do jobs that normally, you know, could, would be done by people spending a bunch of time doing that and can free up people now to do other things.
Ed:
I know it feels like we might have already covered the AI topic, but we will cover more of that as we get into the conversation. Clearly, it’s something that all of us are embracing operationally, but then also in our products. And we’ll talk a bit more about that as we get into the conversation. Thank you for that intro, Kunal.
All right. I’m going to kick off our first segment of conversation here around looking and talking about RegTech solutions and how those are redefining compliance at a strategic level. So how is technology really changing the compliance playbook for banks, credit unions, and fintechs?
Anna, I’m going to ask you to kick us off here and start with your thoughts on the shifting regulatory expectations around complaint management, which you teed up earlier, and how are RegTech solutions changing the approach to compliance here?
Anna:
Sure. Well, as I’m sure all of the participants know, one of the most prominent ways that regulators look at you is through your complaints, right? Like that’s how regulators get clued into your issues. And that’s a large indicator for when doing bank examinations, during any type of audit, one of the first things that they ask about, what about your complaints? And the expectations are changing.
Currently, in the past, you could have self-reported complaints or databases like, say, CFPB database with complaints, but more and more automation is being required, right? So the regulatory expectations are now that you’re going to find your issues much faster than what you were doing before. The expectation is that you’re going to respond faster. So it’s on you, as a financial institution, now to find your issues faster, right? So you need to figure out ways to automate.
So I think there’s some talk about regulatory shifts. There is some consideration that maybe the federal government will not be as strict on complaints and compliance overall. There was this conversation that maybe this administration will be a little more, I don’t know what the right word is, but maybe flexible, right? But I think that hasn’t necessarily been the case, like, customer complaints, for example, have always been in the center of what regulators think about and continue to be.
And also if the federal regulator is a little less prominent, like there is some sort of consideration around CFPB right now, it is customary that state regulators step up their enforcement.
So the sort of how the agencies work with each other is also a flow that has to be considered. And historically, when one regulatory body is a little bit less prominent, other bodies step up. I think nothing has really changed about the expectations except that you’re now expected to do things faster and better.
Ed:
I like that description there that the leadership perhaps has shifted from one spot to another spot, but the expectations are still there. And given the world we live in, everything needs to be faster. So finding the issues, responding to them, that is a common theme I think we see across the board.
John, let’s build on this theme of transformation and how RegTech solutions can help shift behavior in the compliance space. And this idea of moving from a reactive one to a more proactive one when it comes to compliance, that’s going to, I think, have more staying power beyond any sort of administration or regulatory shift, kinda getting off the back foot onto the front foot. So can you talk a bit about this shift towards a more proactive approach and perhaps share an example of how that’s playing out in the marketplace?
John:
Yeah, I think we’ve seen a gradual shift, I think back to, you know, PerformLine’s journey and we started working in the financial services space in 2013. Like Anna mentioned, you know, that was a big time. The CFPB had been created, the Dodd-Frank Act was enacted, and we saw and encouraged the growth of the compliance function and the evolution of the Chief Compliance Officer and their processes. But at that time, many of the companies we talked to were largely doing manual review processes, which proved challenging for a variety of reasons. And I think companies started to see the benefit in automation and scalability in data insights that allowed them to be more proactive and identify risk before it was too late. But not everyone was a believer. And I think under the last administration, we saw heavy enforcement, we saw challenging audits.
And companies who have growth plans in some cases were halted by being reactive instead of proactive, and we used to say under that administration, there were three ways that we would work with a new customer.
Number one is that they were being proactive and before they launch a BaaS program or a card product, they would come to companies like PerformLine or Spring Labs and they’d say, ‘Hey, how can we get ahead of complaints? How can we get ahead of sales and marketing compliance?’
In some cases, they were told during an audit that they had deficiencies in certain areas and they needed to improve those.
And in other cases, and this was never our favorite, but they would get hit with a consent order. And in that consent order, they would have to adhere to certain specifications around their monitoring program.
And so I think from those four years, more companies started buying into a proactive approach. And even though, as Anna highlighted, the regulatory environment has changed. We’ve actually seen a lot of companies continue to lead with that proactive approach and continue to invest in compliance. And I think the lower enforcement action has also opened other doors. We’ve seen, and this is, again, was reiterated when we were at the event this week, but more companies are increasing partnerships, launching new products. A lot of them are launching crypto products, stable coin products. They’re launching new marketing channels like influencers and affiliates.
That marketing motion really can’t happen unless you have a great partner in compliance who is being proactive and has the controls in place to allow your business to do that responsively. And when you think about being proactive and being strategic, you know, a lot of the conversations we had were with companies who said, ‘hey, we want to launch a digital asset product in the next six to 12 months. How can we make sure that we’re monitoring appropriately when we go to market on that?’
So it does seem like the proactive approach has stuck.
Ed:
So it’s less about covering your flank and it’s more about saying ‘Look, this is actually a way that we could win in the marketplace if we do this well. We happen to be covering our flank, but we also are going to differentiate and potentially open up doors if we lean into this and we get onto the front foot.’
John:
I think so. We talk about compliance being a catalyst for growth. Being a partner to the product team and the sales and marketing teams. And I think we’re starting to see that a lot of financial institutions.
Ed:
I like that terminology and hopefully some of our audience will take that back and amplify that message that compliance can be a catalyst for growth. That’s a great phrase.
Ed:
Kunal, we’re in a world today where payments, transactions, movement of money is just accelerating right by the minute, It’s an incredibly fast clip. So there’s an increasingly large number of opportunities for fraud out there in the marketplace.
How should a community financial institution think about scaling its compliance activities in these areas?
Kunal:
Yeah, it’s a great question.
I think with a larger volume of activity comes greater risk, like more surface area, as well. I mean, it also is true for like, if you’re building new products as new things are coming out in the market and putting those out there. Now with that, normally you would think, I’ve got to scale up my team.
But I think like now, AI sort of changed the game on that. I mean, what we’re seeing now with our AI agents, it’s like massive reductions in, like, handle time or the number of alerts like that can be reviewed by a person in a given amount of time. And I think what that is, is like you have this, previously there was like this trade off, we talk about between how safe you want to be and like how fast you can move. And the safer you want to be, the slower you gotta move kinda thing. But I think that that is no longer true with the sort of technology unlocked.
Ed:
I had those two, those two dynamics there of this trade off between growth and expense. So, it’s no longer a situation where you need to take on that expense in order to grow. As you said, you can grow in a scalable manner there, right?
Kunal:
That’s right.
Ed:
You’re not constrained by access to people and resources in a hiring market and onboarding market, it totally changed the equation there alongside the other dimension there of speed and safety. So, think those are two really interesting sets of levers there.
Let’s take these conceptual ideas now then and let’s go down a level, if you will, into some practical applications and practical approaches of drilling into how innovations addressing common compliance pain points…
Jessica:
Thanks for listening to this week’s episode of the COMPLY Podcast! Stay tuned for part 2! As always for the latest content on all things marketing compliance you can head to performline.com/resources. And for the most up-to-date pieces of industry news, events, and content be sure to follow PerformLine on LinkedIn. Thanks again for listening and we’ll see you next time!
Rhonda McGill 
