AI has compliance and education potential
The financial planning industry can use artificial intelligence as part of the regulatory technology (regtech) framework to detect risks and errors in the advice process before it affects the customer and provide education to advisers to correct the mistakes, according to Kaplan Professional.
Kaplan chief executive, Brian Knight said there has been significant improvement in machine learning and artificial intelligence that has allowed for the use of cognitive solutions to enable financial services businesses and licensees to use the machine to detect risky content in the advice process such as at the statement of advice (SOA) stage as the content was produced in real time.
Advice practices could then introduce the education piece by implementing corrective “just-in-time” learning to rectify mistakes. This would have applications for various stages of the advice process.
“We’re actually working on at the moment doing statements of advice well advanced so a statement of advice can be put through the machine and it can pick up errors, mistakes or anything that potentially shouldn’t be in there at scale and at cost and then you can be the user and the licensee getting an opportunity to correct that before it goes to the consumer,” Knight said.
Knight added Kaplan was currently attempting to tie the education piece to the risk detection stage, where, if content was detected as risky, there would be an immediate learning piece with an assessment component that would appear on the screen of the user.
“So they actually learn as they [go], ‘well you’re making a mistake, here’s what you need to read, here’s an assessment’, and then they can self-correct, and then use their compliance teams,” Knight said.
"The impact on this is that this will potentially allow compliance teams to be able to be more constructive in what they do rather than having massive teams having to sit there checking files and checking content.”
AUTHOR
Malavika Santhebennur
Recommended for you
The Reserve Bank of Australia has delivered its first rate decision since the introduction of a new board structure last month.
ASIC was active in the first quarter of 2025 with several financial adviser bannings and court action, while the FSCP also handed down outcomes to advisers.
With a joint venture announced between WT Financial and Merchant Wealth Partners, the firm may have a US background, but partner David Haintz has a long history with Australian financial advice.
The big four bank is set to see $40 million per annum in cost savings as it continues to migrate customers from its Asgard wealth platform to BT Panorama by FY26.
