financial compliance officers

Abstract: The way software gets built is changing dramatically. AI agents now create pull requests, select dependencies, refactor codebases, interpret test failures, and execute infrastructure changes across the entire Software Development Life Cycle (SDLC). AI agents are autonomous team members, but unlike human engineers, they are ephemeral - their reasoning, decisions, and tool calls vanish the moment the session ends. Modern Security incidents involving intent mismatch or injection are becoming increasingly common - forcing us to address AI Agents as an insider threat. No widely adopted standard yet enables agentic provenance and governance and its obvious that you can't hold an ephemeral process accountable. The git log was designed for human commits. It shows what changed. It does not show what an AI agent did, which model it used, which tools it called, or whether anyone was accountable for the outcome. Every governance framework, every audit trail, every compliance control in the SDLC was built around one assumption: a human made the decision. That assumption no longer holds. This shift introduces 3 main procedural problems (not addressing scale) - Supply-chain vector - The agentic coder is software, so it is a supply-chain security risk. Policy guardrails - How to ensure the agentic coder is compliant with the policies of the organization. Task-alignment - How to align the agentic coder on its tasks and goals. We introduce Agentic Process Evidence (APE), a signed, tamper-evident, machine-readable attestation of agentic processes, linking the sessions to their outcome (process-aware logging). APE enables Policy-as-Code control over the agentic processes, allowing for human in the loop only when it's needed. We support the in-toto style attestation framework, and the protocol is aligned with the relevant regulations

Abstract: Frontier AI models are increasingly deployed on topics where the stakes are high and expert judgment is required, including healthcare, defense, finance, governance, and politics. We present a general methodology for distilling expert human judgment into automated evaluation systems that operate at scale. Our approach assembles networks of domain experts and develops techniques for extracting not just their conclusions but their reasoning processes, encoding those processes into structured editorial standards that automated judges can apply continuously. We ground our approach in a long tradition of research on the nature of expertise and the conditions under which expert judgment is reliable and more effective than other approaches, and argue that independent, expert-calibrated evaluation is necessary not only on epistemic grounds but as a matter of accountability and public trust. We validate the methodology on AI news reporting as a first application domain. On source quality, two independent domain experts achieve Krippendorff's $α= 0.83/0.69$ on a held-out test set when applying the editorial standards, and our automated judge reaches $F1 = 0.81/0.97$ against expert consensus. On neutrality, experts achieve $α= .72$ on the test set, and the automated judge reaches $F1 = 0.86$ against expert consensus. Additionally, a controlled comparison shows that expert-calibrated judges substantially outperform uncalibrated frontier models on every source-quality metric, demonstrating that encoding expert reasoning is the critical step that prompt engineering alone cannot replace. We present this benchmark as a proof of concept for a broader evaluation infrastructure applicable to any domain where judgment matters and expertise is scarce.

Abstract: This paper presents Making Tax Smart with Open Banking (MTS-OB), a novel DLT-based architecture designed to integrate real-time VAT compliance into the existing payment system through split payments and Open Banking. Motivated by the substantial VAT gap, the research investigates how leveraging the informational value embedded within payment transactions can reduce the tax administration burden. MTS-OB, a proof-of-concept application built on R3 Corda, facilitates automated, real-time VAT split payments (VSP) without disrupting current payment infrastructure. MTS-OB integrates with existing banking systems via Open Banking APIs, enabling secure information management for VAT collection, reporting, analytics, and automated compliance enforcement. The system uses traditional bank deposit money as a real-time information sensor thereby extending its functionality to include "money as a medium of real-time taxation". Scalability testing demonstrates the system's ability to maintain operational stability under increasing transaction loads, illustrating its potential for real-world deployment. The key finding is the necessity of redefining money to include its informational value for real-time tax compliance, requiring a redesign of the money system while adhering to existing regulations and standards. This research demonstrates the feasibility of integrating tax functionality directly into payments, offering a path towards "hard to get tax wrong" compliance and a potential reduction in the VAT gap without compromising financial stability.

Abstract: Money-mule networks move criminal funds through many small transfers, each of which looks ordinary on its own. What marks an account as a mule lies outside any single transfer: in the counterparties and addresses its network shares, and in the shape of its activity over time. Production systems remain largely rule-based and see neither, while most research classifies transactions rather than accounts, recovering account-level risk only by aggregating afterwards. We instead score the account directly, reading the bank's relational schema as a heterogeneous graph in which rows are nodes and foreign keys are edges. Each account is scored from a multi-hop neighbourhood using per-column encoders, a relative-time encoding and HeteroGraphSAGE message passing, with that neighbourhood restricted to rows predating the account's own pre-flag cutoff so that no model sees evidence recorded only after the account was flagged. On a five-year Reserve Bank Innovation Hub (RBIH) retail-banking dataset of 400 million transactions and 94{,}063 labelled accounts, 2.6\% of them confirmed mules, we compare against RelGNN, XGBoost, LightGBM and CatBoost trained on identical labels, splits and cutoffs. Our detector recovers nine in ten held-out mules at 83\% precision and a 0.5\% false-alarm rate, finding 115 more mules than the strongest tree ensemble given the same evidence. At the tuned thresholds the gap is mostly in recall: XGBoost and LightGBM lead across the first hundred alerts, but only the graph models hold their precision deep into the queue. Since the graph is the schema itself and every score is dated per account, the approach deploys on a bank's existing database without a custom feature graph build.

Abstract: Existing long-horizon agent benchmarks often emphasize final task success while providing limited assessment of intermediate execution validity. Yet real-world business operations require agents to navigate extensive, potentially outdated or conflicting policies while satisfying critical constraints throughout execution. These requirements are particularly consequential in high-stakes domains such as payments, where intermediate violations can incur financial losses or regulatory consequences regardless of the final outcome. To bridge this evaluation gap, we introduce BizBench, a multi-turn benchmark grounded in real-world procedures from a leading payments company. Its executable environment integrates 789 knowledge documents and 601 discoverable business tools, with consistent policies, states, and tool behavior. The benchmark comprises 50 tasks involving resource constraints, temporal dependencies, prior commitments, and conflicting or outdated guidance. Each task is validated through reference execution, while deterministic checks assess both goal attainment and execution validity without prescribing a single solution path. Experiments reveal substantial limitations even among frontier models: Claude Opus 5 and GPT-6 Sol achieve strict success rates of only 64.0% and 61.3%, respectively. For Qwen3.8-27B, goal attainment reaches 42.0%, but strict success drops to 32.7%, demonstrating how outcome-based evaluation can mask invalid execution. Beyond success rates, DeepSeek-V4.1-Flash averages 191.3 tool calls per run, approximately 70% more than reference executions, revealing substantial execution overhead. Overall, BizBench establishes a testbed for evaluating and advancing long-horizon agents beyond task completion, toward reliable and constraint-compliant execution in complex business environments.

Abstract: Graph fraud explanation generation emerges as an important task, which requires jointly leveraging graph structure and content information to produce human-readable explanations for a given risk label. An intuitive approach is to adapt existing graph-enhanced large language models (LLMs), which inject graph structure into LLMs via graph-conditioned instruction tuning or structure-aware embeddings. However, existing methods face two key challenges in graph fraud explanation generation: a lack of evaluation protocols tailored to explanation quality, and a mismatch between the granularity of graph information they provide and what explanation generation requires. In this paper, we propose FRaud Explanation Generation via Agentic Graph Context NavigaTION (FRACTION), a framework for graph fraud explanation generation. To evaluate explanation quality, we introduce a task-specific rubric that assesses faithfulness, graph grounding, helpfulness, consistency, and conciseness, and validate it against human judgments. To focus on fine-grained details of relevant neighbors without reading the entire neighborhood, we equip a language model with graph tools that progressively disclose neighbor records. To train our graph agent, we propose a rubric-guided trajectory distillation strategy through which the agent learns both tool-use behavior and structured explanation generation. Experimental results on three fraud datasets demonstrate consistent improvements over state-of-the-art baselines under a human-aligned rubric.

Abstract: Financial fraud in corporate transaction networks has grown more coordinated and harder to detect with rule-based engines and with classical learning models that treat each transaction in isolation. This paper presents GTFD, a graph-transformer fraud detector that fuses structural and temporal evidence from a corporation's payment graph. GTFD encodes the graph with a multi-head graph attention network, encodes ordered transaction sequences with a gated transformer, and combines both views through a cross-modal gating layer. A conformal risk-control head converts the fused representation into threshold-free anomaly scores with finite-sample coverage guarantees, and the network is trained with self-supervised link-mask pretraining plus adversarial augmentation so it remains stable under scarce labels and under adversarial perturbation. On a corporate transaction benchmark enriched with coordinated fraud rings, GTFD reaches an AUROC of 0.990, an F1-score of 96.1% (precision 96.3%, recall 95.9%), and an accuracy of 98.4%. It reduces the false-positive rate by about 29% relative to the strongest baseline while raising coordinated fraud-ring recall from 85.1% to 96.5%. Ablations attribute roughly 2.0 AUROC points to self-supervised pretraining and 1.9 AUROC points to the conformal head, and adversarial stress tests show GTFD retains 89.2% accuracy at perturbation magnitude 0.20 where the next-best model falls to 76.4%.