{"slug": "he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built", "title": "He spent 15 months hunting for compliance software that didn’t exist. So he built Flagright, which just raised $12.5M.", "summary": "Baran Ozkan spent 15 months searching for compliance software that didn't exist, so he built Flagright, an AI operating system for financial-crime compliance. The startup has raised $12.5 million in Series A funding led by Infinity Ventures, with participation from Sella Direct Ventures, Frontline Ventures, and Y Combinator. Flagright aims to replace legacy systems and separate tools with a unified platform for transaction monitoring, watchlist screening, risk scoring, case management, and investigations.", "body_md": "Baran Ozkan spent 15 months looking for software that did not exist. As head of financial-crime product at a European bank, he wanted a single tool to catch money laundering and fraud. Vendors overpromised. His own employer tried to build one in-house and failed.\n\nSo he built it himself. His startup, Flagright, has now raised a $12.5mn Series A led by Infinity Ventures, a San Francisco fund whose partners ran deals at PayPal. Sella Direct Ventures joined as a new backer, alongside existing investors Frontline Ventures and Y Combinator.\n\n## The ‘operating system’ pitch\n\nFlagright calls itself the AI operating system for financial-crime compliance. In plain terms, it tries to replace two things at once: the legacy systems banks have run for years, and the patchwork of separate tools bolted on top.\n\nIt folds transaction monitoring, watchlist screening, risk scoring, case management and investigations into one platform. When a payment moves through a customer’s system, Flagright checks it in real time for fraud, money laundering and sanctions risk. It then hands compliance teams a result they can explain to a regulator.\n\nThat last point matters. Banks will not deploy a black box. So Flagright leans hard on “explainable” AI, with auditable agents and humans kept in the loop. Clients replacing older tools report up to 93 per cent fewer false positives, the company says.\n\n## AI versus AI\n\nThe timing is the pitch. Banks are squeezed from two sides: more transactions to watch, and [criminals using AI to industrialise fraud](https://thenextweb.com/news/global-scam-economy-442-billion-ai-fraud-yahoo-boys). Interpol puts global fraud losses at $442bn, and says AI makes the crime far more profitable.\n\nDefenders are answering with their own AI, and investors are funding it hard, from [Behavox’s $175mn raise](https://thenextweb.com/news/behavox-175m-hps-blackrock-ai-compliance) to startups [automating regulated back-office work](https://thenextweb.com/news/poetic-openai-50m-enterprise-automation-underwriting). The financial-crime compliance market was worth about $26.5bn in 2025 and could nearly triple by 2034, by one estimate.\n\n## A crowded field, a narrow window\n\nFlagright is small: about 40 staff, offices in London, San Francisco and Singapore, and more than 100 banks and fintechs across 30-plus countries. It is up against deep-pocketed incumbents such as NICE Actimize, Feedzai and ComplyAdvantage.\n\nOzkan’s case is timing. Older players are bolting generative AI onto old systems, he argues, while Flagright built on it from the start. “We are the oldest company for generative AI technology in financial crime,” he claims, an odd boast for a three-year-old, but one that captures how slowly the industry moved.\n\nThe new money goes to sharpening the AI and pushing into the US. The real question is whether a 40-person startup can set the standard before the giants catch up.\n\n## Get the TNW newsletter\n\nGet the most important tech news in your inbox each week.", "url": "https://wpnews.pro/news/he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built", "canonical_source": "https://thenextweb.com/news/flagright-12-5m-series-a-ai-financial-crime-compliance", "published_at": "2026-06-19 10:55:29+00:00", "updated_at": "2026-06-19 12:11:50.146082+00:00", "lang": "en", "topics": ["artificial-intelligence", "ai-startups", "ai-products", "ai-agents", "generative-ai"], "entities": ["Flagright", "Infinity Ventures", "Sella Direct Ventures", "Frontline Ventures", "Y Combinator", "Baran Ozkan", "PayPal", "NICE Actimize"], "alternates": {"html": "https://wpnews.pro/news/he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built", "markdown": "https://wpnews.pro/news/he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built.md", "text": "https://wpnews.pro/news/he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built.txt", "jsonld": "https://wpnews.pro/news/he-spent-15-months-hunting-for-compliance-software-that-didnt-exist-so-he-built.jsonld"}}