Accenture Finance & Risk Services

Examining Recent Enforcement Actions for Critical Lessons Applicable to Your Institution

Philippe GuiralSeptember 29, 2015ACAMS 14th Annual AML & Financial Crime Conference

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Employee Negligence

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Dominant Root Causes• Lack of knowledge of regulatory requirements, policy updates and

corresponding implications• Lack of testing and automated controls

Recommendations1. Executive Leadership Messaging

• Strong and Consistent “Tone at the Top” • “Compliance Culture”

2. Enterprise Learning Capability• Global learning program for all employees• Role specific simulation and case-based training methods

3. Multiple lines of defense strategy• Internal control/Global Compliance Knowledge Center• Independent testing and audit

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Technology Limitations

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Dominant Root Causes• Interim (temporary) solutions used long term• Source systems not configured properly• Alerts buried in large volume of false positives

Recommendations1. Automated robust and integrated solution

• Strategic business and technology roadmaps• Comprehensive sanctions technology architecture

2. Ability to block customers across all source systems• Authentication and access controls

3. Advanced technology to limit false positives • Efficient name matching algorithms (linguistic-based translation) • Solution able to handle volume (clustered/virtualization)

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Data Issues

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Dominant Root Causes• Issues with data quality, integrity and completeness• Lack of Risk-based Approach

Recommendations1. Data Sourcing Analysis and Data Quality Controls

• Integration, conformity, consistency, development and duplication• Data integration reporting implementation

2. Integration of CDD (KYC) and Sanctions Screening• Cannot screen what has not been included in the CDD/KYC data

collection process

3. Effective Risk-based Approach• Delivers effective prioritization of resource activities• Know how to screen and what to screen

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What’s Next?

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Many financial institutions have conducted large scale look-back and remediation programs relating to sanctions requirements in order to satisfy increasing regulatory scrutiny. The good news is that remediation programs will come to an end as Consent Orders and enforcement actions are closed. However, financial institutions should on an ongoing basis:

1. Assess their sanctions capabilities versus industry best practices in order to identify strengths and weaknesses

2. Define future state improvements in order to target poor capabilities

3. Develop a strategic roadmap in order to build and maintain a sustainable Sanctions Program

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Examining Recent Enforcement Actions for Critical Lessons Applicable to Your Institution

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Disclaimer  This presentation is intended for general informational purposes only and does not take into account the reader’s specific circumstances, and may not reflect the most current developments.  Accenture disclaims, to the fullest extent permitted by applicable law, any and all liability for the accuracy and completeness of the information in this presentation and for any acts or omissions made based on such information.  Accenture does not provide legal, regulatory, audit, or tax advice.  Readers are responsible for obtaining such advice from their own legal counsel or other licensed professionals.

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