PRACTICAL SOLUTIONS

Those numbers are the most recent evidence of an emerging trend that poses a unique threat to these organizations . While sanctions screening fines have always been part of the regulatory environment , the upward trend indicates that OFAC is beginning to specifically target nonbank institutions , with insurance , logistics and money services businesses among the hardest hit . With this sobering thought in mind , these businesses must prepare their internal systems for increased regulatory scrutiny .

However , that is easier said than done . Many of these organizations have separate teams managing various functions , so sanctions screening efforts are tedious and manual . Furthermore , data streams flow into the organization and collect in disparate systems that never connect , and customer data resides in disconnected platforms that never merge for a consolidated customer risk profile .

But this problem is not specific to nonbanks . According to a recent ACAMS poll , 73 percent of the respondents said they use two or more solutions for automated screening . This might be one of the reasons why 58 percent of respondents said a regulator or internal auditor challenged their methodology for conducting a sanctions risk assessment . 2

While every organization faces its own particular obstacles , they all face three main business challenges toward establishing a centralized compliance platform : creating a unified vision and corporate buy-in for compliance management ; connecting disparate departments , systems and data feeds ; and uniting all compliance functions into a single platform without having to start from scratch .

Creating a unified vision

As regulatory expectations increase , a constant tug-of-war ensues between an organization ’ s compliance and operations groups . This necessitates a unified vision for managing compliance from an organizational perspective .

Naturally , the compliance group will have a lower risk appetite while remaining more averse to risk . For example , they will want the organization ’ s compliance system to cast a wide net , identifying as many matches as possible . This requires a significant increase in the volume of data flowing through the system , as well as additional layers of oversight . However , this increase in volume creates a burden for the operations side , as extra layers of oversight require a steep uptick in the number of investigations of all of the additional matches .

Therefore , a consensus must be formed : Compliance and operations must come together to analyze data and metrics and to determine how to efficiently and holistically manage compliance . The result must instill confidence across business interests , from compliance to legal and the executive level , allowing each a customized view of their compliance data and common ground with which to make risk management decisions .

Connecting disparate systems

Unfortunately , many companies find that the responsibilities associated with compliance lead to a fractured internal compliance landscape ; it is not uncommon for organizations to run multiple business functions that have separate compliance departments , processes and record management systems . While each department may have its own fully functioning sanctions system , their data may be inaccessible , incompatible or difficult to aggregate when a more comprehensive view or approach is needed .

1

“ Understanding OFAC : A Best Practices Compliance Guide for Businesses ,” CSI , http :// csiweb . com / resources / white-papers / understanding-ofac-a-best-practices-compliance-guide-forbusinesses ? utm _ source = Link & utm _ medium = Article & utm _ campaign = Acams _ IDRiskHub _ RC _ 06 _ FY18

2

“ The 2017 Hollywood Conference Polling Results Are In ,” ACAMS Today , April 24 , 2017 , http :// www . acamstoday . org / 2017-hollywood-conference-polling-results /

38 ACAMS TODAY | SEPTEMBER – NOVEMBER 2017 | ACAMS . ORG | ACAMSTODAY . ORG