THE FUTURE OF ENTITY DUE DILIGENCE

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THE FUTURE OF ENTITY DUE DILIGENCE

The world has gone through an incredible amount of technological transformation over the past ten years.  While it may seem hard to imagine that change will continue at this pace, it’s not only likely to continue, but it will accelerate. There are various functional areas within institutions that support global commerce, but some have been laggards in adopting new technology for a plethora of reasons.

Structural market trends will force organizations to innovate or they will be subject to consolidation, reduction of market share, and, in some circumstances, complete liquidation.  Future proofing the entity due diligence process is one key functional area that should be part of an organization's overall innovation road map because of the impacts of trends such as: rising regulatory expectations, disruptive deregulation initiatives, emergence of novel risks, explosion of data, quantifiable successes in artificial intelligence (AI), and changing consumer expectations.

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3 things we learned at our Fintech Talks - July Edition Dinner Event→

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3 things we learned at our Fintech Talks - July Edition Dinner Event

Last Thursday we had the privilege of hosting 30 senior banking executives at our quarterly FinTech Talks dinner event. The event theme was Trust, Transaction Monitoring and AML for financial messaging, and Keith Furst, a financial crime expert with experience at leading European and American financial institutions flew in from New York to headline the discussion. 

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The challenges and benefits of mapping SWIFT messages to your Transaction Monitoring System (TMS)

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The challenges and benefits of mapping SWIFT messages to your Transaction Monitoring System (TMS)

The Regulatory landscape and SWIFT messages

Cross-border payments have been a central theme in recent regulatory actions where regulators levied record breaking fines against financial institutions that failed to comply with Bank Secrecy Act / anti-money laundering (BSA / AML) regulations. The Society for Worldwide Interbank Financial Telecommunications (SWIFT) is, in some sense, at the heart of these violations because it is one of the major facilitators of global money transfers which have come under increased scrutiny.

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Correspondent Banking: Risk rating the respondent bank's customers via watch lists

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Correspondent Banking: Risk rating the respondent bank's customers via watch lists

Correspondent banking could arguably be one of the most difficult business lines for AML (Anti-Money Laundering) suspicious activity systems to monitor, but are there any opportunities for improvement and increased sophistication? The fundamental conundrum for Compliance departments monitoring correspondent banking payment activity is that they must rely on the respondent bank's AML policies, procedures, controls and technology systems to identify suspicious activity and to take appropriate steps to mitigate the risks which could result in the respondent bank ending relationships with nefarious customers. In order to remain proactive banks providing access to the US financial markets via correspondent banking relationships should consider increasing the sophistication of how they detect suspicious activity based on what information is already contained in the wire payments and existing watch lists.

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