When thinking about the future of financial crime compliance, compliance officers should consider five main areas in order to assess and prioritize investments to pave the foundations for their future financial crimes programs.
In these challenging times with continuous regulatory pressure, financial institutions need to be agile. To maintain competitive a competitive advantage, institutions need to pursue strategic compliance investments. The following five key areas can help to position the programs to compete in the future:
1. A culture of compliance:
Globally, regulators are identifying poor culture as the root cause of many types of misconduct. To be prepared, compliance leadership should be able to:
Regulators are increasingly expecting a consistent approach to financial crime compliance across organizations. Organizations can begin by creating better coordination and communication mechanisms between their various compliance units. Moreover, organizations should breach down business unit barriers by fully integrating teams, systems and processes under one financial crimes umbrella. And, they can establish enterprise wide monitoring and testing protocols to manage financial crime risks centrally.
3. Data and technology infrastructure:
Financial institutions must understand how technology is used across departments and business lines and integrate it where possible. Regulatory obligations require institutions to:
4. Regulatory change management:
Thinking about change management allows an institution to systematically and consistently manage current regulatory risks and anticipate the future by:
5. Staffing model and digital labor:
Over the past years, institutions have struggled with high attrition rates, particularly within their AML compliance departments. This has resulted in a loss of institutional knowledge. Automated processes and incorporation of digital labor would greatly help AML and future financial crime compliance departments with this human resources issue.
Compliance officers will benefit from prioritizing work streams and evaluating how investments in these areas above will impact their organizations AML and financial crime compliance approach, and benefit the institution overall.