The Promise and Peril of AI
Across industries and roles, one theme dominates many conversations today – AI. Once seen as a futuristic concept, it is now reshaping how we live and work, and the world of risk consulting is no exception. But as we welcome this technological revolution, a key question emerges: Can AI truly replace human expertise, or should we rethink how we work and make AI our ally rather than a competitor?
Traditionally, “risk research” meant painstakingly gathering data, evaluating credibility, understanding context, and connecting the dots to form a reliable picture. Today, AI has transformed this process, bringing unprecedented speed, scale, and pattern recognition.
The potential payoff is appealing – smarter processes, faster insights, and greater time and cost efficiency, all of which translate to enhanced client value. Over the years, risk consulting has evolved from a labour-intensive craft to one that is sophisticated and technology-enabled. Yet, even as AI promises that it can accelerate what we do, it cannot replace why or how we do it.
Proceeding with Caution
While AI opens doors, it also carries risks. Recent cases have shown that the technology, though powerful today, is not infallible.
- In a Big Four report, AI-generated inaccuracies led to the firm having to issue a refund to its client (Financial Times: https://www.ft.com/content/934cc94b-32c4-497e-9718-d87d6a7835ca)
- In Singapore, lawyers were rapped after submitting fictitious AI-generated legal citations (Singapore Law Watch: https://www.singaporelawwatch.sg/Headlines/two-lawyers-rapped-over-entirely-fictitious-ai-generated-citations-submitted-to-court)
These incidents caution us of AI’s current pitfalls: hallucinated citations, fabricated references and overconfident errors. The cases serve as timely reminders that AI can process data but cannot discern truth. It lacks the judgment, context, and instinct required to evaluate reliability and interpret nuance.
At this stage, perhaps the right question isn’t “Can AI replace humans?” but “How can we harness AI responsibly to complement our skills?” The balance lies in using AI as a force multiplier, not as a substitute for human thinking.
Why Human Insight Still Matters
Every consultancy today, regardless of size, is likely anticipating or grappling with the arrival of generative AI. But as alluring as automation may be, risk advisory work thrives on discernment – on questioning anomalies, interpreting subtleties, and seeing beyond what data shows.
For businesses navigating complex regulatory regimes, opaque ownership structures, and fast-shifting geopolitical landscapes, reliable insight demands more than algorithms. It requires human intuition, cultural understanding, and investigative instinct – qualities that no machine can replicate.
Our mandate in risk consulting remains unchanged: to uncover truth, provide clarity, and protect our clients’ interests. AI may accelerate that mission, but the ultimate responsibility – to ensure accuracy, integrity, and judgment – remains deeply human.
Clients are not seeking disjointed raw data without meaningful perspective. They seek trustworthy interpretation – insights grounded in context, verified by expertise, and guided by experience.
When AI Missed the Mark: A Real-World Reality Check
We recently conducted research into a wealth management business and its founder across three jurisdictions. AI swiftly generated an impressively detailed report – complete with media mentions, alleged litigation records, purported regulatory sanctions, and even sourced URLs and litigation case numbers. It looked meticulous: names, dates, entities involved, summaries of what happened, even supposed verdicts. AI went a step further, offering to “gather” feedback from former employees. At first glance, it seemed comprehensive and credible – almost too perfect to question. But when our human team rolled up our sleeves and stepped in, the narrative unravelled and the picture changed considerably.
Leveraging on our multilingual capabilities to carry out database, desktop, and open-source research alongside discreet, on-the-ground insights in the respective jurisdictions, we were able to obtain data and nuances that AI missed. Although some of the media references were legitimate, our verification process found that the alleged litigation cases and regulatory sanctions simply did not exist. The realistic looking URLs were invalid, and the case numbers were fabricated. In short, the AI-generated “evidence” was largely hallucinated.
Digging deeper, our human efforts uncovered what the algorithm missed altogether: while the founder herself had a low profile and seemed to be the key decision-maker of the business, her husband – acting quietly in the background – turned out to be an important figure; he had also been linked to several controversial activities. These nuances escaped AI’s data gathering and analysis process, which could not contextualize or connect the human elements underpinning the data.
StratEast’s Approach: Technology with Human Expertise and Experience
The real-world test case was a vivid reminder that AI can aggregate data quickly, but only humans can discern facts. Algorithms recognize patterns, but investigators interpret meaning. AI can generate reports, but human judgment, context, and ground insights remain the ultimate safeguards against misinformation. Had we relied solely on AI, the outcome would have been catastrophic – a reminder that speed without verification is risk itself.
At StratEast, we see AI not as a replacement, but as a strategic enabler that needs to be utilized cautiously alongside human-led investigative efforts. AI can amplify what our people can achieve – accelerating open-source research, data extraction, and preliminary analysis – while our experienced team of human experts ensure that the insights are verified, accurate, contextual, and actionable.
Our advantage lies in being local specialists with extensive access to regional networks and a deep understanding of the region’s business, political, and cultural dynamics. We interpret what AI cannot: the nuance beneath the surface, the subtle signals in behaviour, and the context behind the data. Through an investigative and iterative process, we follow leads to uncover more to obtain a holistic picture. This fusion of technology and human judgment is how StratEast strives to value add by delivering reliable, nuanced, and context-aware insights.
Whether it is tailored services in strategic risk advisory, due diligence and corporate intelligence, compliance and pre-employment screening, or risk assessment and management, our experienced team of locals ensures one constant: AI may make us faster, but human insight and ground access ensures we get it right.
Click here https://strateastinsights.com/ to learn more about StratEast’s services or email [email protected] to explore further.
