Post-Incident Analysis of AI Failure
Regulation, read like evidence.
Each instalment takes one clause of a live regulation, RBI's model risk framework, the DPDP Act, the EU AI Act, and reads it the way an examiner will. What it says, what it actually demands, the real incident that shows its cost, and the one question to ask your team before the inspection asks it.
A record that must answer questions a decade after the model died is not a record in the ordinary sense. It must survive turnover, migrations, vendor exits and reorganisations, and still be believable at the end. Believable to whom, against what standard of challenge. The draft never says. The honest answer is a court's standard, because ten year old questions arrive with lawyers attached.
The tier is the single most consequential number in the entire framework, because it prices every other obligation. Get tiering wrong and everything downstream is wrong in proportion. And the draft saw the escape route coming. Paragraph 20 prohibits factors from offsetting each other into a comfortable average.
Definitions in a regulatory instrument are not vocabulary. They are a staffing plan. The moment approver, owner, developer and validator are defined terms, an examiner can ask for names against each of them, per model, and can test the boundaries between them.
Take your last four risk committee packs and count the model decisions, the committee actually changed. Zero means the framework is decorative, and when an outcome lands on the Board table under paragraph 8, decorative will be the finding.
Name the three highest-materiality spreadsheets in your institution. Not your models, your spreadsheets. If nobody in the room can answer, your inventory was built with a technology filter, and paragraph 7(3) was written for you.
On 24 June 2026 the Reserve Bank of India issued its draft Guidance on Regulatory Principles for Model Risk Management. Sixty four paragraphs. Over the coming sixteen weeks, The Examiner's Question will read all sixty four paragraphs the way a forensic examiner reads evidence. Each Monday episode takes a cluster of clauses and asks five things about it - from what the clause says to the pattern that satisfies it.
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