2nd Annual AML Summit February 7, 2018 Dhaka, Bangladesh

Transcription

1 2nd Annual AML Summit 2018 February 7, 2018 Dhaka, Bangladesh

2 Agenda Welcome Address Shirish Pathak, Managing Director, Fintelekt Advisory Services Inaugural Address Debaprasad Debnath, Consultant, Bangladesh Financial Intelligence Unit (BFIU) Uncovering Sanctions Risk in Trade Finance Transactions Piyush Chawla, Head of Sales, South Asia, Accuity Top 5 KYC/AML Issues Facing Financial Institutions Sanjay Sah, Senior Sales Specialist - Risk, Thomson Reuters Effective AML Compliance Rohan Langley, Senior Solutions Architect, SAS Security Intelligence Practice The Role of UBO in TBML and & Sanctions Compliance Abhishek Jain, Consultant, Bureau van Dijk, a Moody s Analytics company Need for Artificial Intelligence and Machine Learning in AML Akshay Chopra, Director - Strategic Initiatives, Jocata Financial Advisory & Technology Panel Discussion: AML/CFT Trends and Priorities Moderator: Arpita Bedekar, Research Director, Fintelekt Advisory Services Panelists: Swapan K Biswas, Senior Executive Vice President & CAMLCO, Mutual Trust Bank Chowdhury MAQ Sarwar, Consultant, Islami Bank Bangladesh & Country Representative, Fintelekt Major General Sheikh MD Monirul Islam, ndc.psc (retd), Chief External & Corporate Affairs Officer, bkash

3 Participation DESIGNATIONS AVP/VP CAMLCO D-CAMLCO DGM/GM DMD/MD PO/Manager 19% 7% 25% 7% 23% 19% ORGANISATIONS AB Bank Meghna Bank Agrani Bank Mercantile Bank Al-Arafah Islami Bank Midland Bank Bangladesh Financial Intelligence Unit Mutual Trust Bank Bank Asia NCC Bank BASIC Bank NRB Bank bkash NRB Commercial Bank BRAC Bank NRB Global Bank Dhaka Bank Prime Bank Dutch Bangla bank Pubali Bank Eastern Bank Rupali Bank First Security Islami Bank Shahjalal Islami Bank Global IME Bank Social Islami Bank ICB Islamic Bank South East Bank IDLC Finance Standard Bank Islami Bank Bangladesh State Bank of India,Bangladesh Jamuna Bank Trust Bank Janata Bank United Commercial Bank

4 Welcome Address Shirish Pathak, Managing Director, Fintelekt Advisory Services On the one hand, banks have to put in place internal processes and systems around AML frameworks, budgets, KYC, transactions monitoring, screening, reporting, training. If these are not in place, the bank is at grave risk and is also contributing to the country risk. On the other hand, compliance officers have to continue to expand and deepen their domain knowledge in areas such as TBML, remittances, narcotics, smuggling, terrorist financing techniques, human trafficking, virtual currencies, dual use goods and other areas. By being better prepared to manage these risks, a compliance officer can contribute to the sustainability of the bank. For FIUs and regulatory authorities, it is important to scale up the regulatory technology backbone to improve speed of processing information received from reporting entities and timely dissemination of analysis to law enforcement. Also required are sharp enough teeth to regulatory authorities for levying penalties so that banks take their responsibilities really seriously.

5 Keynote Address Debaprasad Debnath, Consultant, Bangladesh Financial Intelligence Unit The region is a destination and trans-shipment point for illegal drugs and smuggling of goods and gold smuggling remains a key risk along with human trafficking ML/TF challenges in Bangladesh stem from a pre-dominantly cash-based economy, increase in cyber-crime, use of alternative remittance systems, trade-based money laundering (TBML) and criminal activities such as drug trafficking Bangladesh has made important progress with preventive measures for the financial sector and DNFBPs and has applied significant resources to raise ROs' awareness of their AML/CFT obligations. ROs have made progress in moving to a risk-based approach (RBA) implementation of preventive measures and rules-based implementation has deepened. Continued implementation challenges include lack of enforcement, capacity constraints, and the need for coordination across jurisdictions.

6 Uncovering Sanctions Risk in Trade Finance Transactions Piyush Chawla Head of Sales, South Asia, Accuity Expect increased enforcement from regulators on sanctions compliance Sanctions risks in a trade finance transaction are unique and complex Mitigation of sanctions risk in trade finance requires a specialized screening solution approach Policies, procedures and training, specifically for trade finance need to be in place Compliance and trade operations need to and are coming together

7 Top 5 KYC/AML Issues Facing Financial Institutions Sanjay Sah Senior Sales Specialist - Risk, Thomson Reuters Despite dramatic increase in headcount and spend, KYC resources remain the biggest challenges for Fis Despite continued investment, onboarding times are still rising Many FIs have not implemented all the requirements for ongoing KYC checks A mixed approach to regulatory changes indicates that many FIs lack clear plan FIs have continued to increase their expenditure more than the average compared to 2016

8 Effective AML Compliance Rohan Langley Senior Solutions Architect, SAS Security Intelligence Practice Banks as well as regulators are under pressure due to rapid changes and new concerns due to an increased focus on compliance Key takeaways for compliance from global best practices are to implement a culture of compliance, adopt a riskbased approach, document and verify, and to get external validation of processes and systems An AML and CDD system need to be able to quickly comply with rapidly changing regulations. Further they should have the ability to optimize existing AML alerting systems to target a reduction in workload and increased efficiency.

9 The Role of Ultimate Beneficial Ownership in TBML & Sanctions Compliance Abhishek Jain Consultant, Bureau van Dijk, a Moody s Analytics company Limited access to global ownership data in Sanction programs have created unknow and risky sanctions exposure Global ownership can only be certain if the data source captures ownership across every country and companies of all sizes Automated data process based on multiple sources is crucial to detect ownership changes as and when they occur.

10 Need for Artificial Intelligence and Machine Learning in AML Akshay Chopra Director - Strategic Initiatives, Jocata Financial Advisory & Technology There is a growing awareness that rules alone are often not sufficient to detect money laundering cases, and regulators have started pressuring banks to adopt sophisticated analytics in their workflows. Rules-based systems typically generate large amounts of false positives. Further, rules reflect past expert knowledge but may not surface sophisticated new money laundering schemes designed to circumvent the rules in place. With the rise of computing power and new analytical techniques, banks can now extract deeper and more valuable insights from their ever-growing mountains of data using advanced analytical techniques at an industrial scale.

11 Panel Discussion: AML/CFT Trends and Priorities Swapan K Biswas The progress of Bangladesh on AML compliance has been commendable. The banking industry is working in line with the latest circular from the BFIU, which has issued very robust guidelines. Compliance Officers association is in the process of being formed, which will play a greater role in future to counter AML challenges. From L to R: Arpita Bedekar, Fintelekt Advisory Services, Swapan K Biswas, Mutual Trust Bank, Chowdhury MAQ Sarwar, Islami Bank Bangladesh & Fintelekt, Major General Sheikh MD Monirul Islam, ndc.psc (retd), bkash Chowdhury MAQ Sarwar Tone from the top is critical. AML training for top management and board of directors is very important, as the latest BFIU circular puts accountability on the Board for AML failures. Major General Sheikh MD Monirul Islam KYC for mobile payment providers is challenging due to the segment in which we are operating. There is a need to build a culture of compliance within the organisation and make the business side understand the importance of AML compliance.

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