Regulatory DataCorp: Making Regulatory Compliance Rational

“I’ve always been fascinated by human frailty,” says Thomas Obermaier, CEO of Regulatory DataCorp (RDC), “Especially when we try to rationalize the irrational.” Obermaier’s fascination with this behavior—predicting the irrational, bringing symmetry to the asymmetric—is what drove him to risk management and what he calls the crossroads of the limits of human reasoning and the boundless optimism of technology.

Financial crime prevention lies at the heart of this intersection. “Financial criminality is inherently irrational; yet regulators the world over are pressing executives for a rational technological solution to predict and prevent it,” said Obermaier. “CIOs around the world are struggling for a better, faster, and cheaper solution to overcome regulatory pressures and margin compressions.”

Enter RDC. It provides sophisticated GRC (“Governance, Risk and Compliance”) solutions to financial institutions, corporate and technology companies the world over. Its unique SaaS-based platform, combining risk data, analytics, human analysts and technology, makes the previously thought impossible reality by precisely identifying key risks and eliminating them before they materialize.


CIO’s around the world are struggling for a better, faster, and cheaper solution to overcome regulatory pressures and margin compressions


The foundation for its service is the world’s largest risk relevant database, GRID, or Global Reg¬ulatory Information Database. GRID is over a decade old and was created by screening 2.5 billion news articles, scrutiniz¬ing over a million websites and reviewing over two million gov¬ernment lists, creating what Ober¬maier refers to as a “formidable database.” All of this data is tagged, assigned a risk code and risk stage, and is completely configurable to each firm’s numerous risk tolerances. “It’s the old risk maxim of se¬verity x probability x maturity on steroids.”

Just look at RDC’s approach to PEPs, or politically exposed persons, the long standing financial crime conundrum. Traditional approaches treated all PEPs as having the same risk. Not RDC.
Tom Obermaier, CEO
Yes, it has a multi-million collection of PEPs and their associates the world over. But RDC also created a risk rating system for PEPs, considering both micro and macro factors, that is also configurable for each firm. It is an innovation that allows firms to better process and risk allocate their resources to prevent PEP risks from materializing.

But that is not the whole solution. Side-by-side with this tool is a hybrid technological and human analyst engine that substantially enhances the productivity of RDC’s clients. This engine finds needles in haystacks, eliminating false positives, scoring clients for key risk developments, identifying current risks, and monitoring a firm’s entire customer, counterparty and vendor list for material developments each and every day. “It allows our clients to pull into the full service lane at their risk gas station,” says Obermaier.

Businesses are finding real value with RDC’s comprehensive solutions. Obermaier gives the example of a financial services firm that was using a compliance management solution that gave them a 99 percent false positive rate for the checks they were performing. The firm had just completed an acquisition, doubling the organization size and bringing the headache of even more false positives to the forefront. After approaching RDC and buying their GRID solution, the firm found that RDC, while handling twice the amount of volume as their competitor, had 90 percent fewer false positives.

RDC isn’t finished building either. Obermaier says they are working towards creating real time solutions that will combine transactional data at financial institutions and other data from open sources to make a more predictive model. “Risk management innovation is the soul of RDC.”

Company
Regulatory DataCorp

Headquarters
King of Prussia, PA

Management
Tom Obermaier, CEO

Description
A Trust Diligence company that delivers powerful, decision-ready intelligence and world-class risk and compliance protection to identify banned/suspect entities, strengthen fraud protection, ensure regulatory compliance, manage supply and distribution risk, and protect organizations’ brand equity