FinregE Warns Banks: Fix Data Governance Gaps Before Increasing RegTech Spending

FinregE has issued a critical warning to financial institutions, asserting that a widespread "data ownership gap" is jeopardising billions in compliance technology investments. For fintech professionals, this highlights a systemic failure where advanced RegTech tools are being deployed atop fractured internal data foundations, leading to regulatory friction despite increased spending.

What was announced

Analysis from FinregE indicates that the primary cause of RegTech implementation failure is not vendor inadequacy, but rather a lack of internal accountability regarding data governance. As the global RegTech market scales toward a projected $250 billion valuation, 95 per cent of firms have adopted at least one compliance tool. However, research from Parker and Lawrence reveals that 47 per cent of compliance leaders view the poor state of their own data as the chief obstacle to successful implementation.

The warning highlights a significant disconnect: while data quality is cited as a barrier, fewer than 25 per cent of institutions acknowledge that fragmented internal ownership is the root cause. FinregE points to Citibank’s $535 million in fines accrued between 2020 and 2024 for risk management and data governance gaps as a high-profile example of technology failing to compensate for process deficiencies. Regulators are increasingly focused on this area; the European Banking Authority has attributed over half of serious anti-money-laundering failures involving RegTech to insufficient oversight and in-house expertise. Furthermore, an FCA review of 3,800 firms identified fundamental weaknesses in the regulatory reporting systems of one in ten organisations.

To mitigate these risks, FinregE advises firms to adopt three specific disciplines: conducting data-readiness discovery prior to signing contracts, separating licensing from implementation and remediation costs with clear acceptance thresholds, and appointing a specific accountable owner for data readiness before any project commences.

"Without expert innovation, current AI systems can flag likely duplicates through semantic similarity but cannot yet determine whether similar obligations are duplicates or legitimately separate requirements. Fed governed data, AI compounds the benefit. Fed chaos, AI compounds the chaos faster than any reviewer could."

Nathan Naicker, Implementation Manager at FinregE.

The companies involved

FinregE is a London-based regulatory intelligence specialist founded in 2018 by Rohini Gupta, CEO, and Amit Madahar, Chief Technology Officer and Co-Founder. The firm operates the FinregE Regulatory OS, an end-to-end operating system that monitors over three million regulatory data points across 160 jurisdictions. By pulling from more than 2,000 sources, the company converts complex legal texts into actionable intelligence. Their position in the UK market is cemented by a five-year contract with the Financial Conduct Authority (FCA) to redesign and manage the official FCA Handbook website through 2029.

The company’s growth was bolstered in January 2026 by a strategic investment from Moody’s Corporation, the global integrated risk assessment firm. Moody’s, known for its credit ratings and analytical tools, invested to accelerate the development of FinregE’s platform. Other entities mentioned in the analysis include Citibank, a major global financial services corporation, and the European Banking Authority (EBA), which functions as the regulatory agency tasked with implementing a standard rulebook for the EU banking sector.

What FF News has reported before

FF News has closely followed the intersection of regulatory infrastructure and AI-driven intelligence. We recently covered how FinregE Unveils New Blueprint to Solve FCA PS26/15 Transaction Reporting Challenges, which addressed specific mapping hurdles for UK firms. Additionally, the broader ecosystem of FinregE’s partners was highlighted when Moody’s Integrates Decision-Grade Intelligence into Google Cloud’s Gemini Enterprise for Financial Services, demonstrating the increasing reliance on high-fidelity data for AI applications in finance.

What this means

This announcement signals a shift in the RegTech narrative from "buy and plug" to "fix and clean." The industry is reaching a tipping point where the sheer volume of regulatory data points—now in the millions—renders unmanaged data a liability rather than an asset. Vendors are under pressure to prove their tools can handle "dirty" data, but the ultimate burden is shifting back to the C-suite. The EBA and FCA’s findings suggest that regulators will no longer accept vendor failure as an excuse for reporting errors. The core question for the sector is whether institutions will invest in the unglamorous work of data hygiene or continue to face escalating fines for "compounded chaos."