The more AI agents are deployed in scenarios with possibly unexpected situations, the more they need to be flexible, adaptive, and creative in achieving their goals. Thus, a certain level of freedom to choose the best path to a specific goal is necessary in making AI robust and flexible enough to be deployed successfully in real-life scenarios. This is especially true when AI systems tackle difficult problems whose solution cannot be accurately defined by a traditional rule-based approach but require the data-driven and/or learning approaches increasingly being used in AI. Indeed, data-driven AI systems, such as those using machine learning, are very successful in terms of accuracy and flexibility, and they can be very "creative" in solving a problem, finding solutions that could positively surprise humans and teach them innovative ways to resolve a challenge. However, creativity and freedom without boundaries can sometimes lead to undesired actions: the AI system could achieve its goal in ways that are not considered acceptable according to values and norms of the impacted community.

Artificial intelligence and machine learning could be the next frontier for ETFs to outperform the market. So says Robert Tull, President of ProcureAM, an innovative exchange-traded product firm and wholly owned subsidiary of Procure Holdings. A veteran in the business, Tull has been involved in the ETF industry for decades, creating more than 400 ETFs across 18 different countries. Now, he's looking at new ways to beat the market by using big data as raw material, combined with machine learning, to build ETF portfolios that could potentially outperform active management -- even actively managed ETFs. "Active management has been out there for a long time, underperforming," he said on CNBC's "ETF Edge." "They haven't found a solution yet, and I think the technology that I've run into is going to help the marketplace today."

Every rule based system contains four basic components. Firstly, the system contains a set of rules, also known as the rule base, and acts as the domain of knowledge for the computer. Second, there is an interference engine, also called the semantic reasoner. This component is responsible for interpretation of the rules and taking action accordingly. The interference engine works in three steps: match, conflict-resolution, and act.

--In recent years, the interest in interpretable classification models has grown. One of the proposed ways to improve the interpretability of a rule-based classification model is to use sets (unordered collections) of rules, instead of lists (ordered collections) of rules. One of the problems associated with sets is that multiple rules may cover a single instance, but predict different classes for it, thus requiring a conflict resolution strategy. In this work, we propose two algorithms capable of finding feature-space regions inside which any created rule would be consistent with the already existing rules, preventing inconsistencies from arising. Our algorithms do not generate classification models, but are instead meant to enhance algorithms that do so, such as Learning Classifier Systems. Both algorithms are described and analyzed exclusively from a theoretical perspective, since we have not modified a model-generating algorithm to incorporate our proposed solutions yet. This work presents the novelty of using conflict avoidance strategies instead of conflict resolution strategies.

Most insurance companies depend on human expertise and business rules-based software to protect themselves from fraud. And the drive for digital transformation and process automation means data and scenarios change faster than you can update the rules. Machine learning has the potential to allow insurers to move from the current state of "detect and react" to "predict and prevent." It excels at automating the process of taking large volumes of data, analysing multiple fraud indicators in parallel – which taken individually may often be quite normal – and finding potential fraud. Generally, there are two ways to teach or train a machine learning algorithm, which depend on the available data: supervised and unsupervised learning.

[Context:] Model-based testing is an instrument for automated generation of test cases. It requires identifying requirements in documents, understanding them syntactically and semantically, and then translating them into a test model. One light-weight language for these test models are Cause-Effect-Graphs (CEG) that can be used to derive test cases. [Problem:] The creation of test models is laborious and we lack an automated solution that covers the entire process from requirement detection to test model creation. In addition, the majority of requirements is expressed in natural language (NL), which is hard to translate to test models automatically. [Principal Idea:] We build on the fact that not all NL requirements are equally unstructured. We found that 14 % of the lines in requirements documents of our industry partner contain "pseudo-code"-like descriptions of business rules. We apply Machine Learning to identify such semi-structured requirements descriptions and propose a rule-based approach for their translation into CEGs. [Contribution:] We make three contributions: (1) an algorithm for the automatic detection of semi-structured requirements descriptions in documents, (2) an algorithm for the automatic translation of the identified requirements into a CEG and (3) a study demonstrating that our proposed solution leads to 86 % time savings for test model creation without loss of quality.

--Regulatory compliance is an organization's adherence to laws, regulations, guidelines and specifications relevant to its business. Compliance officers responsible for maintaining adherence constantly struggle to keep up with the large amount of changes in regulatory requirements. Keeping up with the changes entail two main tasks: fetching the regulatory announcements that actually contain changes of interest, and incorporating those changes in the business process. In this paper we focus on the first task, and present a Compliance Change Tracking System, that gathers regulatory announcements from government sites, news sites, email subscriptions; classifies their importance i.e Actionability through a hierarchical classifier, and business process applicability through a multi-class classifier . Na ıve Bayes, logistic regression etc.), hierarchical classification method, rule based approach, hybrid approach with various preprocessing and feature selection methods; and show that despite the richness of other models, a simple hierarchical classification with bag-of-words features works the best for Actionability classifier and multi-class logistic regression works the best for Applicability classifier . The system has been deployed in global delivery centers, and has received positive feedback from payroll compliance officers. Organizations are faced with rapidly changing regulatory policies, and ever-growing number of regulations.

Being able to model correlations between labels is considered crucial in multi-label classification. Rule-based models enable to expose such dependencies, e.g., implications, subsumptions, or exclusions, in an interpretable and human-comprehensible manner. Albeit the number of possible label combinations increases exponentially with the number of available labels, it has been shown that rules with multiple labels in their heads, which are a natural form to model local label dependencies, can be induced efficiently by exploiting certain properties of rule evaluation measures and pruning the label search space accordingly. However, experiments have revealed that multi-label heads are unlikely to be learned by existing methods due to their restrictiveness. To overcome this limitation, we propose a plug-in approach that relaxes the search space pruning used by existing methods in order to introduce a bias towards larger multi-label heads resulting in more expressive rules. We further demonstrate the effectiveness of our approach empirically and show that it does not come with drawbacks in terms of training time or predictive performance.

Identity fraud detection is of great importance in many real-world scenarios such as the financial industry. However, few studies addressed this problem before. In this paper, we focus on identity fraud detection in loan applications and propose to solve this problem with a novel interactive dialogue system which consists of two modules. One is the knowledge graph (KG) constructor organizing the personal information for each loan applicant. The other is structured dialogue management that can dynamically generate a series of questions based on the personal KG to ask the applicants and determine their identity states. We also present a heuristic user simulator based on problem analysis to evaluate our method. Experiments have shown that the trainable dialogue system can effectively detect fraudsters, and achieve higher recognition accuracy compared with rule-based systems. Furthermore, our learned dialogue strategies are interpretable and flexible, which can help promote real-world applications.

Traditional error detection approaches require user-defined parameters and rules. Thus, the user has to know both the error detection system and the data. However, we can also formulate error detection as a semi-supervised classification problem that only requires domain expertise. The challenges for such an approach are twofold: (1) to represent the data in a way that enables a classification model to identify various kinds of data errors, and (2) to pick the most promising data values for learning. In this paper, we address these challenges with ED2, our new example-driven error detection method. First, we present a new two-dimensional multi-classifier sampling strategy for active learning. Second, we propose novel multi-column features. The combined application of these techniques provides fast convergence of the classification task with high detection accuracy. On several real-world datasets, ED2 requires, on average, less than 1% labels to outperform existing error detection approaches. This report extends the peer-reviewed paper "ED2: A Case for Active Learning in Error Detection". All source code related to this project is available on GitHub.