Retail Banking × Compliance — Singapore · Last updated 28 May 2026 · methodology v2.1 · Hallucination Register

Unverified content attribution for Annex 6C

What the RLB Specialist Panel found

4. Unverified content attribution for Annex 6C

Question (paraphrased to protect IP): What does Annex 6C of the consolidated MAS Notice 637 address?
Source regulation: MAS Notice 637 (Risk Based Capital Adequacy Requirements for Banks) — Monetary Authority of Singapore (Regulator portal: https://www.mas.gov.sg)
What AI assistants typically say: AI tools described Annex 6C as setting out the methodology and criteria for prudent valuation of fair-valued financial instruments, including the framework for additional valuation adjustments — a characterisation drawn from general Basel III prudent valuation standards rather than from the MAS Notice 637 text itself.
What the regulator actually says: No regulator excerpt was available for direct quotation in this finding; the actual content of Annex 6C should be verified by reference to the consolidated MAS Notice 637 text available via the MAS regulatory portal.
Why the AI went wrong: The AI reasoned from the general Basel III framework structure — where prudent valuation requirements typically appear in a Part VI context — and assigned that content to Annex 6C without retrieving or citing any passage from MAS Notice 637. The response provided no section heading, table of contents reference, or document extract to support the characterisation, leaving it as an inference that may or may not match the actual annex content.
Cited source(s):

Impact for Compliance Teams in Retail Banking Sector in Singapore working with the AI Hallucinations Affecting Compliance at Retail Banking Firms in Singapore

If a Compliance or risk officer uses the AI's characterisation of Annex 6C to draft or review the firm's prudent valuation framework — including the firm's methodology for calculating additional valuation adjustments on fair-valued instruments — and the annex's actual content differs from the AI's description, the firm's internal valuation policy may not correspond to MAS's requirements. This matters because prudent valuation deficiencies are a recurring focus of MAS supervisory reviews of trading book practices.

A policy that cannot be traced accurately to the relevant MAS Notice 637 annex is vulnerable to a finding in the next supervisory examination, with potential requirements for remediation and re-submission of affected valuations.

← Previous finding Incorrect framework attribution for Annex 4D scope and exclusions Next finding → Unverified characterisation of Division 4 of Part VI

Cite this finding

Each finding has a stable Citation ID (RLB-F-… for aggregated case-study findings, RLB-H-… for raw per-model hallucinations) — like a DOI, the ID always resolves to the canonical finding even if URLs change.

Plain text Download

RegLeg Specialist Panel (2026). "Unverified content attribution for Annex 6C — Retail Banking × Compliance — Singapore." Citation ID: . RegLegBrief AI Hallucination Research, published 2026-05-28. https://reglegbrief.com/audiences/sectors/sg/retail_banking/compliance/finding/q-NOTICE-637-CAPITAL-ADEQUACY-BANKS-2025-v1-019/

APA 7th edition Download

RegLeg Specialist Panel. (2026). Unverified content attribution for Annex 6C [Hallucination finding ]. RegLegBrief AI Hallucination Research. https://reglegbrief.com/audiences/sectors/sg/retail_banking/compliance/finding/q-NOTICE-637-CAPITAL-ADEQUACY-BANKS-2025-v1-019/

Bluebook / OSCOLA (US + UK legal) Download

RegLeg Specialist Panel, Unverified content attribution for Annex 6C [], RegLegBrief AI Hallucination Research (May 28, 2026), https://reglegbrief.com/audiences/sectors/sg/retail_banking/compliance/finding/q-NOTICE-637-CAPITAL-ADEQUACY-BANKS-2025-v1-019/.

BibTeX Download

@misc{reglegbrief_,
  author    = {RegLeg Specialist Panel},
  title     = {Unverified content attribution for Annex 6C},
  year      = {2026},
  publisher = {RegLegBrief AI Hallucination Research},
  note      = {Hallucination finding Citation ID: },
  url       = {https://reglegbrief.com/audiences/sectors/sg/retail_banking/compliance/finding/q-NOTICE-637-CAPITAL-ADEQUACY-BANKS-2025-v1-019/}
}

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Every finding on this page compares an AI subject's account of the rule against the regulator's verbatim text from the regulator's own portal. Both are linked. Each delta, its root causes, and impact analysis are documented and published with immutable Citation IDs.