Trade Decision & Risk Intelligence Evaluation Report
Trade Request: InnovateCorp – SXF_98345

Date: January 14, 2025  

1. Summary Decision
⚠ Status: Requires Review
The trade cannot proceed due to identified compliance gaps, medium-risk scoring across multiple dimensions, and exposure limit deviations.

A notification has been sent to the submitting sales executive detailing required next steps.

2. Risk & Compliance Scores



Dimension
Score
Rating
Key Drivers




Regulatory Compliance
0.78
Medium Risk
Cross-border attestation missing; jurisdiction-sensitive disclosures required


Counterparty Risk
0.66
Moderate Exposure
Concentration increasing; multiple unsettled derivative positions


Market Risk
0.52
Low–Moderate
Notional aligns with current volatility thresholds


Policy Adherence
0.61
Partially Compliant
SXF exposure limit exceeded by 12%


Composite Score
0.64
Medium Risk
Weighted analysis of market, counterparty, and policy criteria



Interpretation:

Risk scoring indicates that the trade is not eligible for straight-through evaluation and requires human review by a Trade Risk Officer.

3. Automated Findings
3.1 Regulatory Interpretation & Compliance Gaps
Using retrieval-augmented LLM reasoning, the agent extracted relevant cross-border and derivative-compliance conditions:

Missing Cross-Border Trading Attestation for Canada (NI 31-103 requirement).  
No attached pre-trade disclosures for derivative index products.  
Missing explicit confirmation of client suitability approval on record.


3.2 Internal Policy & Exposure Validation
Key internal checks revealed:

SXF product exposure for InnovateCorp exceeds policy limits by 12%.  
Prior exposure-increase request was denied pending stability review.  
Product classification validated successfully; no prohibited instrument flags triggered.


3.3 Counterparty Historical Risk Patterns
LLM analysis of historical trade behavior found:

Three unsettled derivative positions outstanding.  
Higher adjustment requests vs. historical baseline.  
No compliance breaches in past 12 months, though margin-call frequency has risen.


4. Required Documentation Before Proceeding
The following items must be submitted for the trade to advance:

Cross-Border Trading Attestation (Canada)  
Client Suitability Confirmation for index derivatives  
Pre-Trade Disclosures Package  
Manager Approval for exposure-limit override  

These requirements have been automatically included in the notification sent to the requester.

5. Recommended Actions

Forward the case to the assigned Trade Risk Officer for manual review and decisioning.  
Submit missing documentation and re-trigger scoring afterward.  
Generate exposure-limit override justification (draft prepared internally).  
Operations teams must hold downstream booking until clearance is obtained.


6. Audit-Ready Explanation

“Trade SXF_98345 for InnovateCorp was flagged due to partial non-compliance with internal exposure thresholds, missing jurisdiction-required attestations under NI 31-103, and emerging counterparty exposure trends. Composite risk scoring indicates a medium-risk profile unsuitable for automatic straight-through evaluation. Additional documentation and approvals are required before the trade can advance.”


7. Notification Summary
Email Notifications Sent To:

Submitting Sales Executive  
Assigned Trade Risk Officer  
Compliance Intake Mailbox  

Included in Notification:

Summary of findings  
Missing documentation  
Risk and compliance scoring breakdown  
Required approvals  
Next-step instructions