The following is an extract from an article published in the San Diego Business Journal, April 2024.
Full article can be read here: Wells Fargo Taps TradeSun to Strengthen Risk Management – San Diego Business Journal (sdbj.com)
FINANCE > BANKS > NEWS
Wells Fargo Taps TradeSun to Strengthen Risk Management
COMPLIANCE: Top 3 Bank TradeSun’s Biggest Client
BY GARY WARTH
APRIL 30, 2024
DEL MAR – TradeSun has landed its biggest client since its launch six years ago with an agreement to provide its artificial intelligence platform to Wells Fargo.
The Del Mar-based company’s technology will perform documentary credit reconciliation, compliance screening, fraud detection and other tasks in real time for the bank.
“It means credibility,” TradeSun founder and CEO Nigel Hook said about what the new agreement means to his company. “Artificial Intelligence has only begun to get recognition in the last few years, and banks are known to be very conservative when it comes to adopting such revolutionary technology.
“In trade, Wells Fargo is one of the top banks in the world,” Hook continued. “And they’re also very conservative known to be the most discerning in the industry when it comes to pioneering technology, so that’s why this is particularly a big win for us.”
TradeSun began as the advanced analytics service firm DataSkill in1981 and started providing artificial intelligence solutions for trade compliance and automation under its current name in 2018. Hook said the privately held company’s revenues are in the millions.
The company has been providing its AI technology to banks for four years, with clients including the Standard Bank Group in Africa, Emirates National Bank of Dubai and Santander, one of the largest banks in Europe.
Cesar Gonzalez, head of Wells Fargo’s Commercial Banking Operations group, said the agreement with TradeSun demonstrates the bank’s progress toward transforming its trade finance and receivables processes.
“Our agreement with TradeSun gives us the digitization and automation tools to strengthen our risk framework, deliver flawless execution, and provide a world class client experience,” Gonzalez said.
Kiran Vuppu, head of Wells Fargo’s Commercial Banking Client Insights and Commercial Lending Product Management group, said TradeSun’s technology will allow the bank to serve their clients in a more streamlined way across all channels.
“We are excited at the possibility of automating select trade finance processes by leveraging Optical Character Recognition and Artificial Intelligence technology through the TradeSun AI platform,” he said. “With certain processes automated, we expect to see operational efficiencies, improved risk management, and to serve our clients better. Plus, TradeSun has additional capabilities, such as advanced compliance automation, which Wells Fargo may consider using in the future.”
In this case, the clients are large importers and exporters. Hook said the TradeSun platform makes financial transactions easier and faster for those customers.
“A lot of what they were doing was manual,” he said. “This enables Wells Fargo to do more with less. And frankly, at the end of the day, it helps a bank allow their people to do things that are of a higher value than pouring through reams of papers and looking for clues.”
Hook also sees the AI technology as a way of making the world a better place.
An ESG Component to Platform
In one example, he said the TradeSun platform can assess the environmental, social, and governance (ESG) score of 460 million companies instantly. The assessment detects if a supply chain player’s practices align with the United Nations’ 17 Sustainable Development Goals, and a good score can mean preferred lending terms from a bank.
“The mechanics are complicated, but the essence is quite simple,” Hook said. “It’s providing an incentive to influence better behavior. There’s probably nothing better than financial encouragement.”
The company’s technology also can allow banks to quickly check if potential lenders are in compliance with regulations or violating sanctions.
“That’s very important for what’s going on in the Middle East and what’s going on in Ukraine and Russia,” he continued. “Those financial transactions have to be checked to make sure no goods are going to a country that has been sanctioned.”
Hook said the AI platform makes detecting financial fraud much more likely.
“When you manually process these transactions, it’s hard for a person to know every aspect,” he said. “Whereas AI has tentacles everywhere, so it can look for clues that may indicate if a transaction has a duplicate invoice where money’s been laundered, or something’s been way overpriced.”
For Hook, fighting fraud is personal. When he was 12 years old and living in North Hampton, England, Hook said his family was a victim of a financial crime, which had a lifelong impact.
“I’ve always been a proponent of doing things in a fair way and preventing people from stealing or taking things from other people,” he said. “It’s just part of what I like to do.”
In a more positive childhood memory, Hook grew up near Bletchley Park, considered the birthplace of computer science and where Alan Turing broke the Enigma Code, an encrypted message used by Germany in World War II.
Hook said learning about Turing while in school inspired his own career in computer science and AI.
