What is operational risk? What would you check for in a transaction regarding human error?

Operational risk is the risk of losses resulting from ineffective or erroneous internal processes, people, systems, or external events. In the context of transactions, human error can manifest in incorrect data entry, errors in checks, or non-compliance with procedures.

To check a transaction for human error, consider:

• Validation of input data (format, ranges, mandatory fields).
• Logging user actions for subsequent audit.
• Confirmation of critical operations (e.g., double confirmation).
• Checking user access rights to the performed operation.
• Automatic checks for duplication or inconsistency of data.

Example of validation in Python:

def validate_transaction(data):
    if not isinstance(data.get('amount'), (int, float)) or data['amount'] <= 0:
        raise ValueError('Invalid transaction amount')
    if not data.get('account_id'):
        raise ValueError('Account ID is missing')
    # Additional checks