ETHIX: Utilizing AI Procurement Risk Detection to Combat Fraud in Latin America
In much of Latin America, public procurement is often associated with opacity, bureaucracy, and corruption. Drafting tender documents, evaluating proposals, awarding contracts, and auditing processes involve a complex chain of legal steps that are difficult to supervise in real time. ETHIX is changing this landscape by using AI procurement risk detection to identify and prevent irregularities before they occur. This innovation represents a major step forward for public procurement automation solutions in the region.
From Silicon Valley to Latin American Governance
ETHIX’s journey began in 2023 when its founders—experts in public law, data analysis, and digital governance—were accepted into Berkeley SkyDeck, one of Silicon Valley’s most prestigious accelerators. Immersed in a deep-tech ecosystem, they developed a vision for using language models and predictive intelligence to review thousands of legal documents. Their goal was to provide a framework for how to detect procurement fraud using AI by analyzing data patterns that human auditors might miss.
Today, that vision is a functional product. ETHIX combines large language models (LLMs) and risk detection algorithms to assist governments and companies across the full lifecycle of procurement. From designing tender documents to selecting vendors, the platform identifies inconsistencies, unusual clauses, and potential conflicts of interest in seconds. For organizations looking at broader shifts in the digital landscape, this mirrors how scaling digital transformation with AI is becoming essential across all sectors.
Driving Efficiency and Real-Time Accountability
According to the company, ETHIX is already in use across more than 10 public institutions and several private organizations in Chile, Peru, Colombia, and Mexico. The early results are significant, including a 60% reduction in the time required to draft legal documents and improved traceability. As one of the premier GovTech compliance platforms Latin America has produced, it bridges the gap between complex legal requirements and efficient administration.
What makes ETHIX stand out is its ability to compare current processes with historical case law, regulatory standards, and audit findings. The AI does not just flag anomalies—it explains the context and why they matter. This “explainable AI” approach ensures that legal and technical teams are supported rather than replaced. This focus on human-centric technology is similar to the approach needed when balancing AI and human connection in business strategy.
Building a Culture of Transparency
The platform is designed to be integrated into existing workflows, allowing institutions to adopt AI procurement risk detection protocols without disrupting their organizational structure. Furthermore, ETHIX is building a public-facing interface that allows journalists, watchdog groups, and citizens to access summaries of active procurement processes. This shift toward data accessibility is a hallmark of data analytics strategy and CX positioning in the modern era.
With backing from GovTech-focused investors and recognition in the 2025 Global Innovation Index, ETHIX has positioned itself as a leading anti-corruption technology. However, the path forward involves navigating technical complexity, legal risks, and the cultural inertia of public systems. By establishing a clear method for how to detect procurement fraud using AI, the startup is tackling the root causes of administrative inefficiency.
The Data Innovation Perspective
From our perspective at Data Innovation, ETHIX represents a critical shift in how we view digital transformation. It is not just about automation for the sake of speed; it is about applying technology to restore integrity to public systems. By providing better visibility into complex systems, public procurement automation solutions help move toward a “cleaner” administrative model where transparency is a real-time function rather than a static report.
Transparency isn’t just a downloadable PDF—it is the ability to see clearly and early. ETHIX is building the tools to make that possible while setting a standard for modern governance. Just as we see in other industries, such as the strategic integration of AI in manufacturing, the key lies in using data to drive both efficiency and accountability.
Source: Blog Venture Capital