The challenge
In May 2025, Reed Smith was retained to advise on a high-profile project related to a financial services client’s failed outsourcing and internal technology platform implementation. These failures triggered regulatory investigations and an enforcement action from the Office of the Comptroller of the Currency.
Reed Smith’s role was to conduct a full-scale investigation into the platform’s issues to determine the client’s legal remedies and devise solutions to satisfy the regulators. But the legal team faced a critical obstacle: most people involved in the key business decisions were gone. With no witnesses to interview and five years of tangled contractual history to reconstitute, the team turned to AI.
Our solution
In the first phase, the team loaded critical documents into Harvey, a generative AI platform built for legal professionals, to create a centralized “Vault.” Drawing on deep AI experience, Reed Smith quickly built a picture of the facts, identified contractual gaps and risks, responded to client questions, and developed a powerful negotiation strategy to address regulatory and operational problems.
In the second phase, the team pivoted to an AI-powered e-discovery platform and quickly developed a comprehensive timeline stretching from the pre-contract period through the discovery of the underlying issues – establishing the basis for over $100 million of claims against the FinTech vendor.
The results
The AI-driven approach allowed the team to extract an initial settlement saving tens of millions of dollars and achieve a significant reduction in monthly fees. With the leverage of a potential $100 million claim, the client was able to obtain an agreement for the FinTech vendor to satisfy regulatory requirements within a prescribed time period, helping to meet regulatory expectations and prevent a cease-and-desist order. What had begun as a black hole of allegations and costs, with the potential for regulators to shut down the business, ended with substantial savings and a business that survives.
