VITAL SOLUTIONS VENDOR RISK MANAGEMENT GUIDE VENDOR RISK I S S U E S & IDEAS TO HELP YOU AVOID THE COULD PUT YOU & YOUR BUSINESS AT RISK TODAY.

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1 VENDOR 10 I S S U E S & IDEAS TO HELP YOU AVOID THE SERIOUS COMPLIANCE CONSEQUENCES THAT COULD PUT YOU & YOUR BUSINESS AT RISK TODAY. RISK VITAL SOLUTIONS VENDOR RISK MANAGEMENT GUIDE

2 Vital Solutions has been at the center of compliance management for over ten years. We believe the new compliance requirements present a series of complex challenges that could negatively impact your business. Here is why...

3 1 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S REGULATORY COMPLIANCE IS NOW LAW. July 16, 2013 The Senate voted confirming Richard Cordray as Director of the Consumer Financial Protection Bureau. With official Senate approval of a Director, the CFPB s full regulatory mandate became law. Compliance is no longer an option, it is the law.

4 2 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S NOW YOUR BOARD OF DIRECTORS IS PART OF THE COMPLIANCE EQUATION. Your Board of Directors must immediately become involved in the compliance process. Legally, the Board and Management now have to: Adopt clear policy statements regarding consumer compliance. Establish a compliance function to set policies, procedures and standards. Address consumer compliance issues and risks of harm to consumers throughout the servicing process, including handling consumer complaints and inquiries. Review compliance audit results.

5 3 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S 934 PAGES THAT COULD PUT YOUR BUSINESS AT RISK The 934 page CFPB guide requires a new level of audit preparation that includes transparency, current and accurate vendor information as well as ongoing training. Deficiencies in your compliance management systems can result in violations of law or regulation & associated harm to consumers.

6 4 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S YOU COULD SPEND 10,000 HOURS A YEAR MANAGING REQUIRED COMPLIANCE ISSUES. If you have not delegated these specific responsibilities already, you are about to put a lot of time and effort into meeting even the basic requirements. Regulated entities must: Have a Compliance Management System Establish compliance responsibilities Communicate those responsibilities to employees Ensure that responsibilities for meeting legal requirements and internal policies are incorporated into business processes Review operations to ensure that responsibilities are carried out and legal requirements are met Take corrective action and update tools, systems and materials as necessary

7 5 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S REGULATORS ARE DEMANDING AN EFFECTIVE COMPLIANCE SYSTEM. The CFPB expects every regulated entity under its supervision and enforcement authority have an effective compliance management system adapted to its business strategy and operations. Each CFPB examination will include review and testing of components in your compliance management system. Are you ready? An initial review will help determine the scope and intensity of an examination. The findings of more detailed reviews and transaction testing will determine the effectiveness of the compliance management system and whether enhancements or corrective actions are appropriate.

8 6 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S HOW YOUR VENDORS CAN PUT YOU AT RISK Are your vendors in compliance with the new regulations? If not, their issues become your issues and that could halt the growth of your business. You need clear vision to evaluate your vendors business practices. How are you evaluating them in these areas: Classifications by risk category Contracts, insurance certificates Data security credentials Policies, procedures, NDAs Financial statements, SLAs All other legal and regulatory items

9 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S R I S K VITAL SOLUTIONS HAS THE ANSWER.

10 7 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S A COMPLETE SYSTEM FOR THE COMPLIANCE LIFECYCLE Reporting Ongoing Risk Review New Vendor Engagement YOUR SOLUTION IS ACCESSIBLE ANYTIME, ANYWHERE ON COMPUTER OR MOBILE DEVICE. Initial Due Diligence Risk Assessment WE WILL KEEP YOU ONE STEP AHEAD OF COMPLIANCE AUDITS Our full cycle solution will instantly give you the ability to manage, track and train to stay compliant. Vital s fully outsourced solution combines the best-in-class Vendor Risk Management software with the on-site skill and experience to manage it at our secure location. We have gained industry-leading experience in monitoring and staying ahead of the latest compliance requirements. Our phased approach will give you peace of mind and allow you to focus on what you do best...growing your business. Notifications Monitor Relationship Contract Tracking

11 8 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S VENDOR RISK MANAGEMENT SOFTWARE & STRATEGY TO KEEP YOU COMPLIANT INFORMATION MANAGEMENT AND COMMUNICATION PROVIDE THE CORNERSTONE OF AN EFFICIENT COMPLIANCE PROGRAM. To stay compliant and manage audits requires system-wide organization. Our Vendor Risk Management software has been designed to manage all of your vendor information with a streamlined document repository and all the tools to easily generate a range of robust custom reports. The Vendor Risk Dashboard provides critical reminders and status updates that sync with your Outlook calendar. You can set up notifications of all upcoming activities to key personnel. Whether our experienced staff handles the setup and administration or you choose the self-service option, the Vital Solutions team will guide you to compliance success John Smith

12 9 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S YOUR CUSTOMIZED SOLUTION: PROGRAM OPTIONS AND FEATURES Set Up Vendor Profiles: Compile all required data using our Vendor Risk software within a secure cloud based platform. Access your system via a custom URL Transfer and Construct Profiles: We work directly with your staff and your vendors to set up your vendor profiles. We work directly with all vendors on your behalf to construct profiles. Facilitate Updates: Renew expiring documents, (i.e., annual insurance certificates) Customized Modules: Vendor management Contract management Vendor risk management Due diligence reviews Performance reviews Vendor incident tracking Vendor selection management Service and IT asset management Vendor survey questionnaires Perform Due Diligence: We conduct on-site vendor due diligence and audits. Store documentation in vendor profiles. We facilitate annual reviews and audits. General Support and Consulting: Assist with writing policies Research special requests Provide platform support

13 10 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S WE WALK THE TALK BEST PRACTICES FROM EXPERIENCED INDUSTRY LEADERS THE VITAL FACTS Vital Solutions was founded in 2002 Our founders are industry veterans and have always had a major focus on regulatory compliance and now CFPB alignment. Vital Subsidiaries: Vital Outsourcing Services, Inc. (VOS) Business Process Outsourcing and Mortgage Specialty Services Vital Recovery Services, Inc. (VRS) Accounts Receivable Management currently managing $3.5B portfolio Over 155 years industry experience among top executives As a result of our experience and consistent focus on compliance, we have developed an exceptionally strong compliance footprint and pride ourselves on maintaining a straightforward, hands-on, honest approach. Vital Solutions and its subsidiaries are vendors. As such, we are rigorously audited and vetted on a continuous basis by our customers, which include national banks, mortgage companies and credit grantors..

14 T H E V I T A L G U I D E T O C O M P L I A N C E S U C C E S S NEXT STEPS: LET S DISCUSS YOUR COMPLIANCE CHALLENGES. WE HAVE THE EXPERIENCE AND TOOLS TO TAKE THE RISK OUT OF YOUR REGULATORY COMPLIANCE. CONTACT US: Eric Pittman CFO, Vital Solutions eric.pittman@vitalsolutions.net Chris Shuler CEO, Vital Solutions chris.shuler@vitalsolutions.net