President Biden’s Executive Order on artificial intelligence issued on October 30, mandates rigorous safety and security testing for high-risk AI systems. This includes requiring developers to report test results and undergo red-team exercises before deployment. The order also directs NIST to refine its AI Risk Management Framework (AI RMF), particularly...

The recent AI consultation by the UK Government, which ran from March 29 to June 21, 2023, offered organizations and individuals an opportunity to share their insights and suggestions regarding the UK’s proposed approach to regulating AI. With our experience building validation tools for regulated institutions and knowledge of model...

Introduction While Model Risk Management (MRM) principles are important, meeting the expectations set by regulators (FED 2011, PRA 2023) and fostering a robust risk management framework can be challenging or even confusing at times. We believe all MRM practitioners must develop a good understanding of these principles and actively implement...

The Prudential Regulation Authority’s (PRA) supervisory statement SS1/23 Model Risk Principles for All Banks, signifies a major shift in model risk management (MRM) for banks, and emphasizes the need for clear accountability, rigorous governance, and continuous monitoring and validation of models. The role of technological solutions in this transformation cannot...

Uncertainty plays a critical role in AI model risk management since it can affect their performance, reliability, and ability to make accurate predictions. Practitioners involved with these models, depending on their role within organizations, may not have a complete understanding of the concepts behind model uncertainty which in turn can...

For an international Spanish-speaking audience, our very own Juan Martinez recently had a chance to talk to Plácido Doménech Espí about AI and model risk management (MRM). In this interview, Juan brings the audience into the world of model risk, uncovering the impact of the rapid AI evolution in banking and...