What are financial crime risks?
When talking about financial crime (‘FC’) risks we are generally referring to: money laundering, terrorist financing, bribery and corruption, fraud, sanctions violations and the facilitation of tax evasion.
Why it matters
Understanding the nature and extent of exposure to FC risk is key to developing proportionate and effective systems and controls for your business. Consequently, an FC risk assessment is the cornerstone of an effective financial crime compliance programme.
What regulators expect
Globally, regulatory expectation is that Firms not only understand their FC risks, but can also demonstrate how they identify, report, monitor and react to existing and emerging risks.
A successful risk assessment is simple, proportionate, auditable, defendable and updated periodically.
What we do
We apply a three phased process to the assessment of financial crime risk:
Phase 1 | Identify inherent risk
· Customers · Products · Channels · Geography · Transaction · Third parties
| Phase 2 | Identify and assess controls · Policies · Procedures · Training · Systems · KYC/CDD · Record keeping · SAR filing · Regulatory reporting | Phase 3 | Determine residual risk
· Report · Recommendations · Risk appetite |
What you get
We work with you to understand your unique business and what financial crime risks you face.
Whilst we work with some clients annually, our goal is to provide a risk assessment package that allows you to build out, update and repeat. This includes:
– A clearly defined, written approach and methodology paper including how FC risks were identified and how risk weightings are applied.
– A simple, clear risk assessment report, including full referencing, detailing what source materials has been relied on. These can range from FATF and national risk assessments, to local regulatory requirements and guidance, and high profile global regulatory and criminal actions against firms.
– A control / documentation register, including assessment.
– A final report detailing key observations, any gap analysis findings and recommendations.
Why choose us?
We understand the the risk assessment services several different purposes:
– To form the foundation of your programme
– To demonstrate you understand your risks and defend your proportionate approach
– To evidence how and why your programme is effective
– To set the tone for regulatory review – get this wrong and it is hard to argue that the rest of your programme is effective
Our experience covers designing, developing and conducting FC risk assessments for firms.
Alternatively, as former regulators, monitors / skilled persons we can conduct a third party, independent review of your existing process.
Our experience means that we don’t just know how to do it, we understand why and what your risk assessments should look like.