Global Trustee and Fiduciary Services News and Views Issue 50

Prime, Futures and Securities Services | Financial Innovation 62 Ontology Language. This is several steps up in semantic expressivity than RDF. It is essentially a knowledge representation language that adds semantics to RDF, e.g. it defines what an investment firm is, what product manufacturing involves, etc., so that a machine can read and reason over such statements. Significantly, RDF-S and OWL enable axiomatic definitions of data structures. Thus, SmaRT enables legal and financial industry experts to transform complex legislation, related regulatory rules and other texts containing standards and guidelines into a regulatory natural language (RNL). This standards-based RNL is captured by SmaRT using a combination of human knowledge and expertise augmented by AI and machine-learning technologies, such as those in RegDelta. The Golden Thread of the TechSprint involved the unpacking of the relevant provisions of the FCA’s Handbook SUP 16.12 (SUP 16 covers Supervision Reporting Requirements) along with supplementary definitions supplied by participants from the BoE, into SmaRT’s vocabulary and rules in a human-readable format and persisting it in a machine-readable format in the SmaRT Regulatory Knowledge Base in RDF. This knowledge was then used by software engineers to map firm-specific data concepts in anonymised customer account data to equivalent concepts in the Regulatory Knowledge Base. The rules were also expressed in an RDF graph, while SPARQL queries were created to extract compliant data on retail customer accounts. SPARQL, or the SPARQL Protocol and RDF Query Language, is, as its name indicates, the query language for the Semantic Web and siloed and distributed networked systems. For example, SPARQL can be used to enable querying and integration of siloed financial and risk data for regulatory reporting and risk management. Using the SPARQL Inference Notation (SPIN) framework, rules can be graphed and executed. A software application was created to automate this process. This was then used to extract the required data, transform and load it and then perform the required calculations and populate relevant cells in the FSA 001 Balance Sheet form for submission to the BoE. THE BOE AND THE FCA WANT TO MAKE DIGITAL REGULATORY REPORTING A REALITY.