Former Morgan Stanley CEO John Mack is the new chairman of Lantern Credit, a Newport Beach, Calif.-based firm that uses artificial intelligence to help lenders make better decisions about borrowers’ creditworthiness.
Lantern, formerly known as Neft LLC, was founded in 2013. The company offers a proprietary machine learning engine to lenders, with the goal of allowing them to make timely and actionable credit offers to consumers.
Last month, Lantern announced the acquisition of a machine learning library that it said will incorporate human guidance in order to produce more reliable outputs. The company said that the acquisition would enable it to implement an approach that can be read by people and is easily understood by auditors.
Banks that use machine learning in their loan decisions are facing pressure to ensure that they are not operating inside a black box — a no-no because of the potential for the processes to harm minorities and other legally protected groups.
Mack, who retired from Morgan Stanley in 2011, was an investor in Lantern’s $10 million fundraising round in September 2015. He also serves on the board of Lending Club, the San Francisco-based online lending pioneer.
“Lantern Credit is one of the most innovative companies helping banks and consumers manage credit,” Mack said in a press release Tuesday. “Their groundbreaking work incorporating artificial intelligence into consumer credit tools is addressing the most important challenges within the credit market.”
Also serving on the company’s board of advisers are former Apple CEO John Sculley and James Held, a former CEO at the Home Shopping Network.