Outpacing Operational Risk with Resiliency

Tuesday, April 21, 2020

As the COVID-19 situation comes into focus, numerous examples of fraudulent scams are taking shape. Governments across the world are beginning to rollout vast and essential financial assistance programs to businesses, while savvy fraudsters everywhere are hard at work preparing to abuse these new schemes if they haven’t already started to exploit them.

Over the coming months, Financial Institutions should expect significant increases in financial crime and fraudulent activity given the history of prolific fraud and money-laundering exploiting potential weaknesses during times of global crisis. As such, financial institutions must prepare for spikes in demand for quick and effective KYC, PEP/Sanctions screening, adverse media reviews, and other financial crime-related due diligence.

History tells us that the Banks administrating such programs will rightly be held to high standards of diligence to ensure that financial assistance programs are not exploited and held accountable. Equally, banks will be under pressure to make funds quickly accessible or face substantial reputational damage if they do not.

Herein lies the perennial dilemma banks face when dealing with such situations: In this case the risks are amplified, as staff members begin to become sick, need to care for loved ones, or are redirected to other essential tasks; operational capacity will be reduced. At the same time, demand for the financial assistance programs is huge. Traditional manual processes for reviewing key information will be unable to cope, grinding to a halt under the quantity of applications and lack of resources.

Banks are being placed in an invidious position as their compliance teams become overwhelmed by:

  • Government schemes that require funds to be quickly accessible to new clients
  • Increased lending required to get clients through the uncertainty
  • Changes in consumer patterns
  • Activities challenging traditional transaction monitoring systems that increase alert backlogs
  • Increased trade in medical supplies and pandemic related goods
  • Re-opening of trade borders and relaxing of trade regulations to stimulate economic activity

How Exiger Can Help

Exiger is purpose-built to help our clients manage through this uncertainty. The combination of our award-winning technology, DDIQ, and from-the-industry specialists allow our clients to efficiently and flexibly scale their operations while massively (80%+) increasing the effectiveness of traditional financial crimes processes.

While it may not be possible to carry out a full systems implementation during this time, we can become an extension of your team, taking on the virtual management of remediations, lookbacks and other batch review work while helping you make decisions quicker - and the world a bit safer place to do business.

 
Contact Us

Get our Newsletter

Be the first to hear from our experts. Subscribe today!

Jason Holt, Managing Director | EMEA Regional Leader

Jason is a Managing Director and the EMEA Regional Leader, based in Exiger’s London office. He brings 25 years’ experience in financial crime compliance (FCC) leadership to Exiger, having managed global and regional FCC functions at some of the largest and most complex financial institutions – including Bank of America Merrill Lynch, JPMorgan Chase, Barclays and BNP Paribas.