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In a world of constantly changing threats and evolving regulation, effectively assessing risk is essential for today's financial service providers. Organisations often have an incomplete view of the risks they’re vulnerable to, so embedding financial crime controls in a risk management framework and developing a robust risk assessment tool around this framework has become a key priority. Our client is a global banking and financial services company headquartered in the UK with over 48 million customers worldwide.
Financial crime risk assessment is the first step in managing the risks associated with financial crime. A risk assessment framework is the basis from which all organisations can derive risk indicators and assess their financial crime risk exposure. The framework should include identifiable risk metrics, to provide the most effective levels of compliance and ability to detect, report and prevent corruption, money laundering, terrorist financing, sanctions violations and fraud.
To comply with Financial Conduct Authority (FCA) guidance and the expectations of the US Authorities, our client needed to implement, standardise and globalise its financial crime risk assessment process. A previous incarnation of the process had collected information by email and spreadsheets. This process was inherently inefficient and not fit for purpose for a global financial institution.
As every organisation is unique, a one-size-fits-all risk assessment template does not exist. Instead, our client needed to implement a tailored, risk-based approach appropriate to their business, thus limiting potential exposure to criminality and preventing penalties from the regulator. Working closely with the global compliance function and IT department, we helped identify a suitable data collection tool to collect risk assessment information. After selection, we rapidly implemented the application to meet the challenging timescales of the annual process. Our team managed every aspect of the technical installation and deployment.
Alongside the deployment of the tool, we worked closely with the Financial Crime Risk Director and their team to help their vision of collecting inherent and control risk information take shape. Our team:
Developed and implemented the security model to protect the sensitive information
Trained users in each of the regions and countries across the world
Quality checked the risk assessment returns
Calculated key risk indicators for comparison and reporting
Analysed large volumes of customer and payment information to understand the inherent risks of the client’s business
The global risk assessment process was successfully implemented and embedded across the business lines, regions and countries. It provided a firm foundation for the annual understanding of the nature of financial crime risk. Quality and timelines of the process was significantly improved. An innovative feedback process allowed the country and regional contributors to get early sight of the risks in their part of the business.
The bank has since engaged us to implement further risk assessments within the application to cover more aspects of financial crime.