AML Programs - Business as usual, or not?

Transcription

1 AML Programs - Business as usual, or not? Dan Soto Ally Bank June 16, 2010 BSA Coalition Anti-Money Laundering Conference

2 Determine Customer/Entity Risk Regulatory expectations: CIP? CDD? How to score and how does it matter? How does the client score fit into your bank s AML risk assessment? At what threshold should a score factor into: EDD? When/how does monitoring factor into your client risk scoring? When should scores be refreshed? 2

3 Determine Customer/Entity Risk Risk Score Risk Scoring Elements Risk Factor High Medium Low H1 H2 H3 M L Anticipated i t Relationship size 10 5 Source of First Deposit 10 1 Number of accounts with ownership Channel of origination 10 1 Relationship with High risk customer (relationship premium) Government High referral type Customer Risk SARs Employee 10 1 Vendor 10 1 ID type 10 1 Employment Status 10 1 TIN applied 100 Owner Type Country Risk Country-Zip Physical address Country-Zip Headquarters Address Country of Permanent residency Country of Primary citizenship Country of Dual citizenship Country of Legal organization Doing business with WORST international country Business Owner/Partner/Investor's citizenship 500 HIDTA / HIFCA 10 Sector Risk NAICs Service Usage (ACH, bill pay, wire, Cash etc) Product Risk Account/product type (Checking, saving, loan etc.) 10 5 Open method

4 Determine Customer/Entity Risk Overall Risk Risk Level H1 Risk Score 800+ High Risk H H Medium Risk M Scoring used for: Surveillance/Monitoring Low Risk L CDD EDD Internet Searches/Vendor Sold Solutions/Full On-Site Investigations Watch List Overall AML Risk Assessment NOTE: Factor in recent enforcement actions! 4

5 AML Monitoring Automated versus Manual Monitoring (what s best for your bank)? How do decide on a vendor? What is the right approach in measuring the risk of products/delivery channels? What results should you expect from automated monitoring solutions? What else can you leverage: Fraud monitoring? Sanctions monitoring? Information Security monitoring? Can you monitor for terrorist financing? 5

6 AML Monitoring Transaction Monitoring Data Products/Channels Flows Rules/Scenarios Output AML T ransaction M onitoring i P rocess Flow b y P ro ject AML Monitoring Au uto AML Interim M onitoring Project M anual ETL Procedures WebSeries Wire Transfers Checks Wachovia Connections Intl. Wire Transfers Yodlee Bill Pa y BDR Customers Acc oun ts Tran sa ction s Transaction Monitoring System (TMS ) Hosted at GMAC Data Center Inform ation Warehouse TBD NAO Sy stems Case Management System (CMS) Hosted at E&Y Lists Screening Thresholds Logic 314 OFAC Watch Lists Fraud Data Data D a ta Data Data Bank Auto SAP 1.Document the the current current state, state, identify identify gaps, gaps, enhance enhance the the screening process, integrate integrate to to the the Case Case M anagem anagement ent tool tool 2.Document the the current state, identify gaps, enhance the the screening process, create a a roadm roadmap ap to to consolidate LexisNexis instances 3.Create a a roadm ap ap for for non-bank Auto screening Bank Deposits W arehouse Bank Correspondent Lending C onstru ctio n L end in g Non Bank Accounts Payable Mortgage Bank Auto Consumer/Commercial N on B ank Accounts Payable Auto Non Bank Auto Consumer/Commercial BSA/AML Analyst LexisNexis Bridger Generate W atchlist A le r ts Located; Atlanta R em ediate w atchlist a lerts for e xact matches LexisNexis Bridger G e n e ra te W a tc hl ist A le r ts Located: Lew isv ille Internal SARS A ll w atc hl ist sent to CM T a le rts to b e All alerts to be managed through CMT AML Transaction monitoring alerts E&Y Case M anagement Tool BSA/AML Investigators 6

7 Summary No bright line for high risk (will you know it when you see it?). One size does not fit all! Client risk scoring is part of a consolidated AML Risk Assessment. What you cannot obtain and verify upfront requires more back-office discipline. Monitoring alone may produce small results (at a costly price). You cannot determine that a product/channel is low risk without doing your homework. Leverage resources/solutions for the best results. Output must be handled appropriately. Document, document, and then, document! 7

8 Would this pass your CIP program? 8

9 Thank you