Title: Sweating the Small-And the Big-Stuff: Exam Teams Stress Not Only BSA/AML Details, but Want to See Results
Abstract: [ILLUSTRATION OMITTED] Let's say, per doctor's orders, a patient dutifully chooses a diet and exercise regime in an effort to lose weight. But a month later, when the patient weighs in, the needle hasn't budged a whit. Some patients might swear that they've been doing everything right. The doctors would just point out that scales don't lie. Other than getting a strong talking to, the patient would pretty much be on his own to decide what to do. The doctor isn't going to go to the house to see what a patient is really doing. Bank examiners, however, do make house calls. And in a roundup of input from bankers, consultants, and others, the word is your next BSA/AML exam will be more exacting than ever. First, examiners want to see how well-equipped the bank is with systems and procedures--a longstanding basic. Second, they want to see how well those tools are working. Third, they are stressing impact. Harder-nosed attitude--for a reason Consultant Nancy Derr-Castiglione, one of ababj.com's Common Sense Compliance bloggers, says exam teams want to see more than efficient form-filling. Yes, that's important, she says, but it's a given. Today, they are emphasizing efficacy--is the BSA/AML program accomplishing anything beyond stacking up forms? And is the assortment of tools and procedures being used properly and with an eye toward current events? The days of buy the box and forget it are over. It's getting at the intent, rather than just the going through the motions and checking off the boxes, says Derr-Castiglione. At smaller banks, especially, where compliance staff may be juggling everything from the new mortgage rules to UDAAP concerns, they are facing scrutiny to be sure they are keeping their BSA/ AML efforts on target and current. I've heard that these days, they are checking everything very closely and that they are checking everything in the manual, says Rob Rowe, vice-president and senior counsel, and BSA/AML expert at ABA's Center for Regulatory Compliance. Overall, experts say if you haven't had a BSA/AML exam for a while, when you do, expect examiners to perform a deeper dive and to suggest that the bank consider bringing in outsiders to ensure that systems perform adequately. Attention will not only be paid to direct BSA/ AML issues, but also to sanctions, as enforced by the Treasury's Office of Foreign Asset Control. [ILLUSTRATION OMITTED] While new issues, such as concerns about money laundering via bitcoin and other virtual currencies, have increasingly come on the radar, concern over what's going on with plain-old American dollars has been rising. Rowe points out that regulators are under pressure to improve the BSA/ AML regime. follows hearings held in March in the Senate Banking Committee that examined the state of affairs following a string of large-bank BSA violations. Notably, Senator Elizabeth Warren (D-Mass.) took institutions and agencies to task. And Senate Banking Chairman Tim Johnson (D-S.D.), looking back at large-bank enforcement actions, stated: This pattern of violations is disturbing. ... To address this threat we must understand how banks' safeguards malfunction and assess the way the government enforces our AML rules. Beyond just tough talk As usual, scrutiny not only starts at the top, but rolls downhill. So now banks of all sizes face pressure to up their game. All the regulators are being tougher, says John Atkinson, director at Protiviti, Inc. Indeed, John Byrne, executive vice-president at the Association of Certified Anti-Money Laundering Specialists, says that more bankers have been receiving MRAs from regulators post examination. These matters requiring attention go into exam reports with higher priority than simple written or oral recommendations, and indicate the rising level of concern from the agencies. There are more criticisms of AML programs than ever, says Byrne, who has been involved in this area for decades and also is a blogger on ababj. …
Publication Year: 2013
Publication Date: 2013-11-01
Language: en
Type: article
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