2024-08-16
Daniel Grech, CTO of ZignSec, discussed how he leverages his background in Computer Science and Statistics in the development of KYC and KYB solutions at ZignSec. Daniel outlines how ZignSec uses AI to automate compliance processes, ensuring both global scalability and adherence to regulatory requirements, while allowing experts to concentrate on high-risk cases. Daniel's approach is to enhance efficiency and ensure security in digital identification.
Can you tell us a little about your background and what led you to your current role as CTO at ZignSec?
My background is in Computer Science and Statistics, topics that I have been passionate about since my student days. Throughout my career, I have worked in various roles at several technology companies, starting as a systems programmer working on virtualization systems and evolving into more business-oriented roles, namely assisting large oil and gas companies in automating and optimizing their procurement processes.
I have always been passionate about startups and the idea of creating something new out of nothing. After holding a variety of technical lead roles at various startups in the Fintech sector, I started to understand the complexity of business processes that companies in regulated environments need to manage and orchestrate. This led me to co-found a company called Wyzer that aimed to simplify this by providing a platform on which business processes could be orchestrated and operated in a seamless manner. Wyzer was eventually acquired by ZignSec which was one of it’s clients at the time and this eventually led to me becoming CTO of ZignSec. Today I oversee the development of ZignSec’s KYC and KYB offerings via an orchestration platform that aims to combine the two.
What role do artificial intelligence (AI) and machine learning play in ZignSec's products and services? Can you provide some concrete examples of how you use these technologies?
The world of RegTech is already being significantly disrupted by AI. There are several roles in the regulated space that primarily involve analysing data, looking for patterns in such data and making a reasonable decision based on such an analysis. I believe that these roles can be significantly augmented through the use of artificial intelligence – by automating the majority of such decisions and only requiring specialised human knowledge in edge cases or high-risk cases.
This is the approach we have implemented in our KYB merchant monitoring platform – where we monitor online merchants to validate that they are compliant with applicable laws and regulations. Here, we utilise fine-tuned large language models to understand the context and content of eCommence pages, turning unstructured data into structured data to which we can apply rules in an automated manner. If exceptions are spotted or the system is in doubt, a human expert is brought into the loop. However, the AI system can deal with most cases and without needing any human intervention. This frees us the analysts' time to focus on the cases that have the highest potential to pose a problem – the cases in which specialised human knowledge is most valuable.
Considering the various regulatory requirements in different countries, how do you ensure that ZignSec's solutions remain compliant and scalable globally?
The regulated world is fragmented and complex and it is very challenging for a globally regulated business to understand the different geographical regulatory requirements and to maintain compliance with them. This is the core problem that ZignSec solves through its KYC offerings.
We do this by offering a mixture of globally applicable solutions and solutions that are highly specialised in specific geographies or industries. The solutions that form our platform's basis can generally be applied to many geographies and industries. Such solutions are then augmented with more localised solutions when required and tailored to specific markets through an orchestration platform that can handle the complexities of dealing with multiple markets.
We also ensure that our technology is scalable. We operate a fully cloud-native platform that is based on the concept of microservices – allowing us to maintain flexibility in how and when we scale various aspects of our platform.
Security and privacy are crucial in digital identification. How does ZignSec work to ensure that your services maintain the highest possible security standards?
ZignSec has prioritised and understands the importance of security and privacy since day one and we have always strived to meet the highest standards in these fields. An example of this is that we achieved our ISO 27001 certification at an early stage. Security and privacy are central to all our internal processes and thinking. We operate a risk framework that lets us quantify the extent of risks we face and determine mitigating measures for each of them. This frame of thought allows us to scale our business without scaling the level of risk that we take.
Can you describe some of the most innovative solutions you have developed or are currently developing at ZignSec?
The most innovative solutions that we have recently developed or are currently working on mostly revolve around the use of AI in making sense of unstructured data and applying our domain knowledge to such data to simplify and make business processes related to compliance more efficient.
Examples of such solutions include:
- A Proof of Address solution that can make sense of utility bills and bank statements in an automated manner to allow our customers to use such documents as proof of address for their customers.
- A solution that can automatically determine the industry of a business from its website and classify the business by its Merchant Category Code (a categorisation required by card scheme rules that forms the basis of the underwriting process for online merchants).
- A solution that can analyse the terms and conditions of an online shop and extract structured data from it in a manner that allows for automated risk-based decisions.
What are the biggest technological challenges you have encountered in the development of your identification services, and how have you overcome them?
Developing resilient verification services has presented a multifaceted challenge. The need to harmonise disparate technology stacks across KYC, KYB, and platform systems, while simultaneously managing geographically distributed teams, has demanded strategic alignment and efficient collaboration. Moreover, the imperative to innovate while maintaining legacy systems has required careful resource allocation and a balanced approach to technological evolution. By encouraging a culture of collaboration, knowledge sharing, and continuous improvement, we have been able to navigate these complexities and deliver effective verification solutions.
We thank Daniel Grech for the interview and wish the company all the best moving forward.
Disclaimer:
This is an interview that has been done on behalf of the company. Impala Nordic or people behind Impala Nordic owns no shares in the company at the time of the interview. // Detta är en intervju som har gjorts på uppdrag av bolaget. Impala Nordic eller personer bakom Impala Nordic äger inga aktier i bolaget vid upprättandet av intervjun.