# FinGuard: Detecting Financial Regulatory Non-Compliance in LLM Interactions

arXiv: https://arxiv.org/abs/2605.29427 · HTML: https://mlsanity.com/paper/2605.29427/

## Key facts

- Cited by 2 papers in the map (data through 14 Oct 2026).
- Builds on 27 of its 43 references that are in the map.
- First posted on arXiv 28 May 2026.

## Builds on (most cited first, 27 of 27)

- [The Llama 3 Herd of Models](https://mlsanity.com/paper/2407.21783/) (2024)
- [DeepSeekMath: Pushing the Limits of Mathematical Reasoning in Open Language Models](https://mlsanity.com/paper/2402.03300/) (2024)
- [HybridFlow: A Flexible and Efficient RLHF Framework](https://mlsanity.com/paper/2409.19256/) (2024)
- [LlamaFactory: Unified Efficient Fine-Tuning of 100+ Language Models](https://mlsanity.com/paper/2403.13372/) (2024)
- [HarmBench: A Standardized Evaluation Framework for Automated Red Teaming and Robust Refusal](https://mlsanity.com/paper/2402.04249/) (2024)
- [gpt-oss-120b & gpt-oss-20b Model Card](https://mlsanity.com/paper/2508.10925/) (2025)
- [Qwen3 Embedding: Advancing Text Embedding and Reranking Through Foundation Models](https://mlsanity.com/paper/2506.05176/) (2025)
- [Llama Guard: LLM-based Input-Output Safeguard for Human-AI Conversations](https://mlsanity.com/paper/2312.06674/) (2023)
- [BloombergGPT: A Large Language Model for Finance](https://mlsanity.com/paper/2303.17564/) (2023)
- [BeaverTails: Towards Improved Safety Alignment of LLM via a Human-Preference Dataset](https://mlsanity.com/paper/2307.04657/) (2023)
- [How Johnny Can Persuade LLMs to Jailbreak Them: Rethinking Persuasion to Challenge AI Safety by Humanizing LLMs](https://mlsanity.com/paper/2401.06373/) (2024)
- [WildGuard: Open One-Stop Moderation Tools for Safety Risks, Jailbreaks, and Refusals of LLMs](https://mlsanity.com/paper/2406.18495/) (2024)
- [ToxiGen: A Large-Scale Machine-Generated Dataset for Adversarial and Implicit Hate Speech Detection](https://mlsanity.com/paper/2203.09509/) (2022)
- [Absolute Zero: Reinforced Self-play Reasoning with Zero Data](https://mlsanity.com/paper/2505.03335/) (2025)
- [ToxicChat: Unveiling Hidden Challenges of Toxicity Detection in Real-World User-AI Conversation](https://mlsanity.com/paper/2310.17389/) (2023)
- [FinMem: A Performance-Enhanced LLM Trading Agent with Layered Memory and Character Design](https://mlsanity.com/paper/2311.13743/) (2023)
- [A Multimodal Foundation Agent for Financial Trading: Tool-Augmented, Diversified, and Generalist](https://mlsanity.com/paper/2402.18485/) (2024)
- [Aegis2.0: A Diverse AI Safety Dataset and Risks Taxonomy for Alignment of LLM Guardrails](https://mlsanity.com/paper/2501.09004/) (2025)
- [GuardReasoner: Towards Reasoning-based LLM Safeguards](https://mlsanity.com/paper/2501.18492/) (2025)
- [PolyGuard: A Multilingual Safety Moderation Tool for 17 Languages](https://mlsanity.com/paper/2504.04377/) (2025)
- [Fino1: On the Transferability of Reasoning-Enhanced LLMs and Reinforcement Learning to Finance](https://mlsanity.com/paper/2502.08127/) (2025)
- [SPELL: Self-Play Reinforcement Learning for Evolving Long-Context Language Models](https://mlsanity.com/paper/2509.23863/) (2025)
- [CultureGuard: Towards Culturally-Aware Dataset and Guard Model for Multilingual Safety Applications](https://mlsanity.com/paper/2508.01710/) (2025)
- [Demystifying Domain-adaptive Post-training for Financial LLMs](https://mlsanity.com/paper/2501.04961/) (2025)
- [Beyond Knowledge to Agency: Evaluating Expertise, Autonomy, and Integrity in Finance with CNFinBench](https://mlsanity.com/paper/2512.09506/) (2025)
- [NExT-Guard: Training-Free Streaming Safeguard without Token-Level Labels](https://mlsanity.com/paper/2603.02219/) (2026)
- [GLiGuard: Schema-Conditioned Classification for LLM Safeguard](https://mlsanity.com/paper/2605.07982/) (2026)

## Built on by (most cited first, 2 of 2)

- [FinRiskAtlas: Decision-Aligned Evaluation of Large Language Models for Financial Risk Review](https://mlsanity.com/paper/2608.25325/) (2026)
- [Verdict Without the Rule: Diagnosing and Auditing Regulatory Rule Sensitivity in LLM Compliance Systems](https://mlsanity.com/paper/2610.12313/) (2026)

## Abstract (arXiv)

As large language models (LLMs) are increasingly deployed in financial services, a single non-compliant interaction can expose institutions to regulatory penalties and direct consumer harm. Existing guard models are built around general harm taxonomies and overlook violations grounded in specific financial regulations. We address this gap with a regulation-driven pipeline that operates directly on regulatory documents, inducing a financial compliance risk taxonomy and synthesizing grounded training data without any predefined violation categories. Instantiating the pipeline on Chinese financial regulations, we release FinGuard-Bench, to our knowledge the first benchmark for financial regulatory compliance detection, with expert-annotated labels at both the query and response levels. We further train FinGuard, a financial compliance detection model built on Qwen3-8B and trained on the regulation-grounded data via supervised fine-tuning and self-play reinforcement learning. On FinGuard-Bench, FinGuard substantially outperforms all baselines, including dedicated guard models and much larger general-purpose LLMs such as Qwen3.5-397B-A17B and GPT-5.1. Furthermore, FinGuard also preserves general safety capabilities and adapts to unseen institution-specific policies using policy documents alone. We will publicly release the code, prompts, and resources used in this work on GitHub.