A practical process mining
approach for compliance
UCAM FOM Doctoral School of Business, Murcia, Spain, and
FOM University of Applied Sciences, Düsseldorf, Germany
Purpose –The purpose of this study is to examine whether thecompliance management activities in the
risk managementenvironment of ﬁnancial institutionscan be enhanced using a Process Mining application.
Design/methodology/approach –In this research, an implementationprocedure for a selected Process
Mining applicationis developed and evaluated at a ﬁnancial institution in Germany.
Findings –The evaluation of the process data with the Process Mining applicationDisco shows that the
compliance of the real-life executionof business processes can be monitored in real-time. Moreover, potential
non-compliantactivities and durations can be analysedin a detailed manner.
Research limitations/implications –When the research results are regarded, it must be considered
that a general conditionfor the usage of a Process Mining applicationis that the process data is available and
exportablein the required format and that data privacy regulations are fulﬁlled.
Originality/value –This researchpresents a practical use case for the implementation of a Process Mining
application at the risk management department of ﬁnancial institutions. It shows the value of using a
technical application to carry out tedioustasks that are usually executed manually. This value is discussed
and compared with the aim to help ﬁnancialinstitutions in determining how the effectivenessand efﬁciencies
of compliance managementactivities can be improved. Therefore, this research can be takenas a foundation
for the practicalimplementation of a Process Mining application at ﬁnancial institutions.
Keywords Process mining, Financial regulation, Regulatory compliance, RegTech,
Paper type Research paper
Since the global ﬁnancial and economic crisis of 2007-2008, banks and other ﬁnancial
institutions have been challenged by the exponential increase of regulatory requirements
(Eggert, 2014;Young, 2013). Moreover, both the total number of new regulations increases
constantly and the degree of complexity of newly developed requirements (Eggert, 2014).
One of the key reasons for the increasing regulation is that governments throughout the
world want to ensure stability and reliability of the ﬁnancial sector as a critical part of the
overall economy (Matejasak et al., 2009). However, in the past years, the whole ﬁnancial
system became signiﬁcantly more complex, with products and world-wide integrated
structures that are challenging to understand and to regulate (Allen et al., 2018). Therefore,
detailed and comprehensiveregulations are required to ensure that the probability of a bank
to experience ﬁnancial difﬁcultiesis as low as possible. The bankruptcy of a single ﬁnancial
institution can have aconsiderably negative effect on other organisationsand on the overall
local or global economy (Hull, 2015). To be non-compliant regarding regulatory
Received28 December 2018
Revised22 April 2019
Accepted17 May 2019
Journalof Financial Regulation
Vol.27 No. 4, 2019
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