compliance roadmap work session
TRANSCRIPT
![Page 1: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/1.jpg)
Luc Meurant
New York, 3 March 2015
Update on SWIFT’s Financial
Crime Compliance initiatives
![Page 2: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/2.jpg)
A community issue calling for a community
solution …
Financial crime is top of
the agenda for banks
All geographies / All types
of players impacted
Significant costs
at stake….
... Yet no competitive
advantage for banks
Lots of duplication…
for universal challenges
(opportunity for scale economies)
![Page 3: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/3.jpg)
Financial Crime Compliance
SANCTIONS KYC ANALYTICS
Financial Crime Compliance Utility
Securities
Industry?
Corporates?
GO DEEPER GO FASTER GO BROADER?
CORRESPONDENT BANKING
Sanctions
Screening
Sanctions
Testing KYC
Registry Compliance
Analytics
4 LIVE SERVICES TODAY
- Going forward
![Page 4: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/4.jpg)
More on SWIFT Sanctions Screening
service
![Page 5: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/5.jpg)
Sanctions Screening overview
Your institution
Your correspondents
Hosted and
managed
screening
engine
Daily updates
from
32 lists
+ private lists
Real-time
screening
No
additional
footprint
![Page 6: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/6.jpg)
310 users
107 countries
17 central banks
18 branches
of Tier 1
![Page 7: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/7.jpg)
All traffic
screening
option
introduced
Fine-
tuning
rules
Customer/
Name
Screening
Sanctions Screening roadmap
![Page 8: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/8.jpg)
More on SWIFT Sanctions Testing
service
![Page 9: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/9.jpg)
Effectiveness
• Provide assurance that your filter
works
• Measure system’s fuzzy
matching performance
• Assess coverage of sanctions lists
• Align screening system to your
risk appetite
Efficiency
• Reduce false positives
through iterative testing
• Build optimisation tests into
your processes
• Understand parameter changes
• Manage and tune rules and “good-
guy” lists
Testing Meeting regulatory demands
Tuning Managing cost and resources
Sanctions compliance – balancing priorities
with
![Page 10: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/10.jpg)
Formats
Settings
Lists
Automate • Repeat • Compare • Monitor
Sanctions Testing process
Define
test objective
Download
test files
Process
test files
Upload
hit results
View
test results
Peer assessment being
launched in Q2 2015
![Page 11: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/11.jpg)
Sanctions – Other ideas being considered
• Interest is growing to consider the development
of a fully-fledged Industry Sanctions Utility:
• Built as a fully-fledged and modular service offering
(eg client/transaction screening, list management,
quality assurance, standards, reporting, services)
• Qualification work on-going (eg, partnerships,
phasing, economics)
![Page 12: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/12.jpg)
More on SWIFT KYC Registry initiative
![Page 13: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/13.jpg)
![Page 14: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/14.jpg)
In a nutshell… Single source of correspondent banking KYC information
7,000+ banks on SWIFT
Trusted third party (member-owned)
Leverage SWIFT membership
process to collect ‘basic’ data
User-provided, user-controlled
Up-to-date and validated
information (through dedicated
validation teams)
![Page 15: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/15.jpg)
A Single Standard
Validated data
A feature-rich Platform
Community-lead engagement
Unique value-add content
The founding principles
![Page 16: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/16.jpg)
Identify areas of risk and demonstrate
your declared behaviour: the challenge
Know
Your
Customer’s
Customer
![Page 17: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/17.jpg)
And the Answer: The SWIFT Profile
17
YOUR
CUSTOMER
CUSTOMER’S
DIRECT EXPOSURE
CUSTOMER’S
INDIRECT
EXPOSURE YOU
PUBLISHER OF
THE SWIFT
PROFILE
CONSUMER OF
THE SWIFT
PROFILE
COUNTRY OF YOUR
CORRESPONDENT’S
COUNTERPARTY
COUNTRY OF
ORDERING /
BENEFICIARY
PARTY’S BANK
![Page 18: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/18.jpg)
KYC Registry
ALREADY MORE THAN 150 INSTITUTIONS REGISTERED
(in 75 COUNTRIES)…
… AND COUNTING
HOW ABOUT YOU?
![Page 19: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/19.jpg)
KYC – Other ideas being considered
• A selective extension of the KYC Registry to new
market segments (eg securities, corporates),
contemplating partnerships
• A Market place on top of the KYC Registry to allow
third-party providers to offer services through the
Registry
• A richer RMA application, linked to the Registry
![Page 20: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/20.jpg)
More on Compliance Analytics
![Page 21: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/21.jpg)
Introducing Compliance Analytics Leveraging SWIFT traffic data for risk monitoring
Single Source
Identify
Global aggregated views
Quantify Benchmark vs totals & peers
Monitor
Event driven Alerting
Drive
Focus on high risk
Investigate
Visual analytics
Report
Interactive generation
Look back
Retrospective reviews
![Page 22: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/22.jpg)
![Page 23: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/23.jpg)
Example: Specific Correspondent Risk assessment Where are payments originating from? Ending up in?
1. What are the higher risk
originating countries?
2. Which of my affiliates are
involved in these flows?
3. What are the ultimate
beneficiary countries?
![Page 24: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/24.jpg)
Analytics – Other ideas being qualified
• Enrichment with additional data and flows (possibly
non-SWIFT)
• Extended statistical and analytic capabilities
• FATF16 compliance module
• Contemplating the evolution toward a fully-fledged
AML solution
24
![Page 25: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/25.jpg)
More on Compliance for
Securities Market
![Page 26: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/26.jpg)
Compliance for Securities?
• Significant challenges in the industry (eg Adam Szubin’s
comments on Omnibus accounts)
• Challenges for SWIFT and its community:
– Diverging community feedback
– Multiple overlapping initiatives
• Yet, strong commitment to help the industry:
– New dedicated Securities Compliance Working Group
– Tactical extension of existing services being worked out
– Bolder moves will be qualified
![Page 27: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/27.jpg)
![Page 28: Compliance Roadmap Work Session](https://reader033.vdocuments.us/reader033/viewer/2022042701/55b5a066bb61eb9d7f8b4604/html5/thumbnails/28.jpg)
Thank you