PRACTICAL SOLUTIONS
Furthermore , relationships that are identified as high risk in one compliance system might not receive the same scrutiny in a separate business function within the company if data sharing across systems is difficult or absent .
Uniting into a single platform without starting from scratch
An organization seeking to develop a centralized system must first answer a series of difficult questions : Does it currently manage its onboarding process , know your customer / risk profiling , transaction screening , watchlist updates and other compliance functions in a way that allows for easy aggregation and report generation ? Does it rectify and navigate the competing interests among executive , legal , sales and compliance departments ? Finally and most importantly , do all of those functions interact with one another ?
Once these questions have been answered , the development of a centralized platform begins . Creating a completely new platform from the ground up is difficult , considering most companies have existing processes and platforms they do not wish to abandon . Few organizations have the time , money or programming resources to develop a centralized compliance system from scratch that can seamlessly bridge all the various compliance functions and datasets without affecting the end-user experience .
Therefore , the logical solution is to integrate a platform within the company ’ s existing systems that merges all those disparate systems and processes .
The many benefits of a centralized compliance system
From an audit and regulatory perspective , a centralized system not only allows a comprehensive means to aggregate data on the results of sanctions activity , but also provides a view on both specific and overall compliance efforts , including policies , procedures and controls . In other words , a company should always be prepared to show auditors what they are doing in terms of due diligence , as well as demonstrate the rationale underpinning how they are doing it . A centralized platform is invaluable if a company is asked by regulators to provide documentation showing that it is following appropriate sanctions protocols to prevent risk and meet legal expectations .
There are also financial benefits to implementing a centralized compliance system . A Dow Jones and ACAMS study found that 40 percent of companies surveyed exited a full business line or segment of business in the prior 12 months because of the perceived regulatory risk or their inability to manage that risk . 3 With a centralized sanctions system in place , these regulatory risks become far more manageable , allowing companies to pursue and retain lines of business that would have otherwise been considered out of reach .
Pulling together the various components of an effective sanctions screening program can seem unwieldy . Building a platform from the ground up might be improbable for most companies , given the scope of such a project and the operational implications . So , identifying a third-party platform that can serve as an interlocking system for internal departments , systems and data feeds can be a more realistic option . In leveraging such a solution , organizations can create a holistic compliance screening platform that centralizes all compliance functions into a single view .
Michael Brown , CAMS , vice president of product strategy , CSI Regulatory Compliance , Charlotte , NC , USA , michael . brown @ csiweb . com
3
“ ACAMS and Dow Jones Anti-Money Laundering Insights Survey ,” 2016 , http :// www . acams . org / download-your-aml-resources /
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