Posts about model-risk
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Inference Cost Collapse Is a Governance Liability
When AI agent calls approach zero cost, the natural rate-limiter on decision volume disappears — and oversight frameworks designed for prediction models break.
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The AI/DLT Conflation Trap in HKMA's March 2026 Strategic Review Mandate
HKMA's new strategic review circular bundles AI inference risk and smart contract risk into one workstream — a governance design flaw that will cause banks to under-govern both.
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Model Risk Management Was Not Built for This
SR 11-7 assumes models are tools that produce outputs for human review. AI agents are actors that take actions autonomously. Every assumption breaks.
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Backtest vs Operational Validation: The Control You Think You Have
A model control that's never fired in production isn't a control — it's a hypothesis. The gap between backtest and operational validation is invisible until someone asks.
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What Surprised Me Studying for the GARP Responsible AI in Finance Exam
I expected the hard parts to be the technical sections. They weren't. The governance sections were harder, and more useful.
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Three Things AML AI Models Still Get Wrong in 2026
The models aren't the problem. The operating models are. Three structural failures in AML AI from years building these systems inside a bank.