medium · Frm Part 2 Operational Risk
A bank is evaluating the use of Machine Learning (ML) to triage transaction monitoring alerts.
Which new risk-management obligation does this 'ML Triage' model create?
- It allows the bank to move all AML responsibilities from the first line to the IT department.
- The bank must validate the 'explainability' of suppressed alerts to prove that the model is not creating invisible false negatives.
- The ML model must be trained using external loss data from competitors only.
- It removes the need for SAR (Suspicious Activity Report) filings.
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