If the crushing financial collapse of 2008 had one silver lining, maybe it’s this: the advent of regulatory technology, or regtech as it’s rapidly becoming known, to more effectively rein in an industry run amok.
What Is Regtech?
Rising like a proverbial phoenix from the ashes, hybrid fintech and regtech companies formed to solve challenges that emerge in a tech-first economy. The demand for regulatory technology in the fintech sector is so popular, in fact, that regtech is projected to become a nearly $87 billion industry by 2028, according to Verified Market Research.
Regtech Companies You Should Know
- Chainalysis
- ComplyAdvantage
- Ascent Regtech
- Forter
- Hummingbird
- Continuity
- Trunomi
- Ayasdi
- Sift Science
- Elliptic
- BehavioSec
In a Reuters report praising the power of regtech (especially in the securities trading industry), the Financial Industry Regulatory Authority noted that regtech tools — for example, those that help maintain up-to-date records and facilitate transparent financial deals — “have the potential to fundamentally transform how securities industry participants perform their compliance obligations.”
Here are 17 companies helping unlock regtech possibilities.
18 Regtech Companies to Know
Location: Fully Remote
Enigma’s business intelligence platform takes huge sets of available data on small and medium sized business activity, analyzes it with AI and machine learning, then returns insights that offer clear information on a company’s financial and decision-making behavior. This data can be used in a regulatory capacity for Know Your Business, or KYB, due diligence processes.
Location: New York, New York
BigID hosts a platform for curating intelligence analytics on sensitive collected data. The company’s technologies specialize in cloud-based data visualization, classification and access management for financial services and more. BigID also focuses on privacy automation, with a framework that is compliant with over 20 data regulation laws.
Location: New York, New York
Chainalysis uses blockchain to stamp out money laundering, fraud and compliance violations in the cryptocurrency sector. The ledger-backed software helps financial institutions and crypto trading sites with Know Your Customer and fraud prevention. The company also works with larger financial institutions and governments to warn about and deal with criminal activity.
Chainalysis has partnered with a myriad of digital payment companies, like Nets, to help banks validate Bitcoin transactions and comply with federal regulations.
Location: New York, New York
ComplyAdvantage is an AI-driven risk management database for companies that can potentially be hurt by financial crime. The company’s proprietary Anti-Money Laundering data feed creates profiles, automates customer monitoring with KYC and due diligence tools and screens payments in real-time. The ComplyAdvantage platform is currently used by more than 1,000 companies in money-transferring industries, including payments, stock trading and even gambling.
In a 24-hour span, the company’s AML database can analyze five million new articles across 200 countries and update 30,000 KYC profiles.
Location: Denver, Colorado
CyberGRX creates several products for professionals to manage third-party cyber risk and reduce related costs. The company helps create intelligent risk portfolios to provide data visibility between businesses and tools offered by their partners. CyberGRX offers solutions for data insights, predictive analytics and cyberattack risk of third-party ecosystems.
Location: San Diego, California
Drata is a platform that monitors company security and automates data compliance for SOC 2 and related laws. Users are able to assess security risks, keep track of security controls and manage vendors and employee training. Drata has been used across the finance, healthcare, software and more industries.
Location: New Haven, Connecticut
Elliptic uses blockchain to make cryptocurrency transactions more transparent, plus create ledger technology to keep crypto trading companies up-to-date on AML regulations. The company also combines big data and blockchain to investigate suspicious trading in crypto payments and passes its finding onto banks and government agencies that deal with financial crimes.
In 2017, Elliptic helped expose a fraudulent Bitcoin trading operation run by a group of Russian hackers. Information about the billion-dollar laundering scheme was used by U.S. Special Counsel Robert Mueller to investigate Russian interference in the 2016 U.S. Presidential election and indict the group on fraud and conspiracy charges.
Location: New York, New York
Forter’s Decision-as-a-Service technology is a personalized and automated decision maker for the retail and financial industries. The automated decisioning system tracks trends and flags fraudulent spending in less than one second. Payments are processed by Forter’s technology and marked as approved or flagged for fraud in order to give businesses a more holistic view of their revenues.
Nordstrom, Priceline, Mattress Firm and Delivery.com have all used Forter’s Decision-as-a-Service technology to automate their fraud monitoring processes
Location: New York, New York
Equilend is a platform for trading and post-trading services, such as the ECS Loan Market and settlement monitoring. For over 20 years, the platform has enabled customers to access global assets and reduce risks and scalability, while navigating the financial marketplace. The company offers its services to agent lenders, business owners, broker-lenders and more.
Location: San Francisco, California
Unit21 offers no-code tools for fraud and AML detection, allowing businesses to eliminate engineering focus and automate financial crime detection processes. Whether it’s fraud or money laundering, the toolset can gather data to complete user onboarding, transaction monitoring and case management. Unit21 also allows financial organizations to automate SAR e-filing.
Location: New York, New York
Socure verifies the identity and fraud risk of individuals for commercial purposes and government programs. Using its ID+ platform and other tools, the company can measure the fraud risk of device and email ownership, as well as measure compliance of distributed PII. Socure’s regtech services are used in an array of industries from finance to gaming.
Location: Chicago, Illinois
Ascent’s platform is built around “channels” that are derived from individual regulatory bodies. The company’s platform uses AI to find and house all applicable rules and regulations that affect a company in real-time. Consequently, Ascent users can use their personalized platform to quickly discover documents and regulations (from multiple regulatory agencies) that help maintain financial compliance.
Location: Austin, Texas
Eventus’ Validus platform provides multi-asset solutions for clients to maintain trade surveillance and compliance. Validus offers a combination of surveillance and algo monitoring, as well as AML/transaction monitoring. The company aims to serve crypto exchanges, traditional banks, commodity trading firms and regulators. In 2022, Eventus was selected as a partner by the AirCarbon Exchange partner to bring the first market surveillance program to the Voluntary Carbon Market. The partnership hopes to address finance activities that contribute to greenhouse gas emissions.
Location: San Francisco, California
Hummingbird is an anti-money-laundering platform used by banks as well as fintech, lending and credit companies. The software automates workflows, creates graphics and manages ongoing investigations for AML crime fighters so they can catch financial criminals on a quicker and wider scale.
In 2021, Hummingbird raised $30 million in Series B funding to expand its machine learning processes and contribute toward customer success efforts.
Location: San Jose, California
Trunomi is a customer consent and data rights management platform. It ensures that financial sector customers sign consent receipts confirming that financial institutions can use and share their data. As a result, customers and banks can easily track the financial information to make sure that banks don’t abuse their sharing powers and customers don’t make fraudulent transactions.
Location: Santa Clara, California
Ayasdi created a suite of AI-powered applications to counter fraud, manage risk and flag money laundering schemes. Financial institutions use Ayasadi’s AML platform to chart out payments and predict outliers that could involve fraudulent practices. Additionally, the platform can compile rules and regulations that deal with a company’s current situation to make sure institutions remain compliant.
Location: San Francisco, California
A Big Data company, Sift uses its insights to help companies detect fraud, delete fake accounts and identify money laundering. The company’s machine learning scours all payments and assigns “SiftScores” to each user so clients have a better idea of who is making a payment or abusing the system.
Sift has helped monitor fraud for some of the world’s most recognizable companies, including Airbnb, OpenTable, Zillow, Dwolla and Remitly
Location: San Francisco, California
BehavioSec uses behavioral biometrics software to predict and prevent problems caused by digital fraud. The company’s continuous digital authentications ensure that fraudulent practices — such as account takeover, malware and compliance violations — are flagged before they become serious issues.
In 2021, BehavioSec was awarded two patents for authentication and social engineering detection on its Behavioral Biometrics Platform. All of the tools work to prevent account hijacking and fraud committed with stolen passwords and other identifiable credentials.
