Banks Urged to Boost Compliance Efforts as Financial Crimes and Cybercrimes Increase
A recent report has highlighted the importance of robust compliance measures in the banking industry, as financial crimes and cybercrimes continue to escalate. The report, compiled by a leading regulatory body, emphasizes the need for banks to prioritize compliance to prevent breaches and mitigate potential losses.
Regulatory Compliance Checklist
To help banks navigate the complex web of regulations and ensure compliance, a regulatory compliance checklist has been developed. This practical tool can be used flexibly as part of a holistic approach to compliance, serving as a guide for navigating compliance priorities and ensuring program adequacy.
AML and KYC Programs Crucial for Compliance
The report also emphasizes the importance of Anti-Money Laundering (AML) and Know Your Customer (KYC) programs in detecting and preventing financial crimes. Banks must ensure that their AML and KYC programs are robust and effective, including:
- Conducting customer due diligence
- Identifying Politically Exposed Persons (PEPs)
- Screening for sanctions
- Monitoring transactions
Frequent Testing Required
The report also stresses the importance of regular testing to ensure compliance with regulations. This includes:
- Annual testing by independent third parties or bank staff
- Review of policies and procedures, internal controls, and training program elements and records
Cybersecurity and Financial Record-Keeping Laws and Regulations
In addition to AML and KYC compliance, banks must also adhere to strict cybersecurity and financial record-keeping laws and regulations, including:
- Gramm-Leach Bliley Act (Reg P)
- Sarbanes-Oxley Act (SOX)
- Payment Card Industry Data Security Standard (PCI DSS)
- 23 NYCRR 500
US Federal Laws Applicable to Banks
Other U.S. Federal laws and regulations designed to provide consumer safeguards and ensure transparency and fairness within the banking industry include:
- Americans with Disabilities Act
- Bank Service Company Act
- Community Reinvestment Act
- Consumer Financial Protection Act
- And many others
Conclusion
The increasing frequency and sophistication of financial crimes and cybercrimes make compliance a top priority for banks. A regulatory compliance checklist can serve as a practical tool for navigating compliance priorities and ensuring program adequacy. By prioritizing compliance and staying up-to-date with the latest regulations, banks can protect themselves against breaches and ensure the integrity of their operations.
Contact Us
To learn more about how Alessa’s banking compliance software can help your institution meet its compliance obligations, contact one of our agents today.