A financial services firm uses an AI model to detect money laundering patterns. A new regulation requires that all automated suspicious activity reports (SARs) be explainable to the regulator. The current model is a deep neural network with no built-in explainability. Which approach presents the GREATEST risk to the firm?

C is correct because filing regulatory reports without required explanations constitutes a regulatory compliance failure. FinCEN and other financial regulators expect institutions to explain the basis for suspicious activity reports. This exposes the firm to regulatory sanctions, fines, and potential enforcement action. Using SHAP (A), replacing the model (B), and using a hybrid rule/model approach (D) are all legitimate technical approaches to satisfy explainability requirements.