AML Escalation Workshop

• The purpose of this highly interactive webinar is to encourage, persuade and empower members of an escalation team and their immediate colleagues to make better informed and more effective decisions when dealing with real-world escalations
• To understand the importance of exercising common sense as well as informed judgement because a “rules-based” approach is not enough when dealing with real clients
• To appreciate that some risks are more severe in their consequences than others (US Sanctions for example) and need to be handled more sensitively and more carefully
• To take full account of recent Regulatory comments on this risk area – mainly negative so far - and the importance of having in place an effective and sound control system
• To consider setting up and creating KRI’s.
• To consider helpful and practical suggestions on how to achieve the “sweet spot” between too many and too few escalations in a “real world” situation.

Session 1: Introduction- Overview

• The role of the Transaction Monitoring generally – the “safety net”
• The huge majority (99.9% plus probably) of our customers DO NOT launder money, are NOT terrorists and do NOT breach sanctions – so why is this so important?
• What should we do with alerts – we shouldn’t be escalating either too much or too little?
• Level 1, Level 2 and Level 3 (MLRO) roles & responsibilities
• Always three choices with an alert
  • Green Zone, Business as Usual, do nothing – its ok
  • Amber Zone – Mildly unusual, seek more information (most common response)
  • Red Zone – Highly unusual, immediate action needed
• How do we select the KRI’s for each zone?
• Achieving the “sweet spot” – not too little not too much
• Using common sense and judgement – a tick box approach does not work – we are dealing with people who can respond in “mysterious ways”
• Exercising judgement – why is this essential and how to do so
• Sanctions screening – what are we looking for in practice
• AML & FCC screening – what are we looking for in practice
• Creating an internal “good guys” list so we do not investigate the same transaction several times
• Quality control process. Why. How does it help?
• Several Short Case Studies and Examples to Illustrate the Above

Session 2: Dealing with Alerts in Practice

• IF IN DOUBT – always escalate
• Recent (2021) FCA & Wolfsberg guidance/criticism
• What is our alert system telling us and how should we prioritise?
• What should prompt us to judge no action is needed
• What should prompt us to judge more information is needed
• What should prompt us to judge this is unquestionably suspicious
• The difference between concern and suspicion
• When should we seek more information from the client?
• The Four D’s in a SAR
• Dealing with front line colleague resistance by explaining WHY we need the information
• How should we reach out to the customer and in what way?
• Balancing the risk of tipping off with the need for more details
• Adding your own opinion/recommendation on an escalation as a first step towards taking more confident decisions
• Challenges in practice
• Several Short Case Studies and Examples to Illustrate the Above

Webinar Conclusion/Summary/Open Forum

The trainer had a highly successful, long and varied “fast track” career in Lloyds Bank which led him to a very senior management position in the bank’s private banking and wealth management division at an early age. He was then “headhunted” to join a merchant bank to head the risk function at main board director level. He now has over 40 years of experience in the UK banking and financial services sector.

He has been a freelance Compliance, FCC & AML training consultant since retiring and is currently an external Master Trainer at both HSBC and Bank of China. At HSBC he has been a leading member of their global FCC & AML training programme which is now entering its sixth year. He has created and delivered training to a vast range of clients, from global giants to small firms and partnerships. He is an accomplished global trainer and has delivered extensive programmes in the UK, USA, South America, Europe, Africa, Asia and the Middle East.

The trainer is a highly adaptive, hands-on and highly sought-after facilitator who always receives excellent feedback from delegates. He is comfortable training at any level of seniority and experience, from “black belts” to novices. As well as his Compliance, FCC & AML specialism, his expertise includes but is not limited to Risk Management, Trade Finance and all major aspects of Corporate, Private & Retail Banking. He is also a highly experienced soft skills trainer and has completed numerous “train the trainer” assignments.

Analysts and anti-money laundering (AML) investigators reviewing customer transactions have an important, but an often overwhelming job. Finance professionals tasked with alert resolution, performing periodic reviews on high-risk accounts and conducting investigations during a look-back transaction analysis, must consider myriad variables.

The rate of false positives remains an issue. As high as 99% plus in the view of some experts

Increasing budget constraints, deadlines, and volumes of information make it challenging for analysts to address all factors for each investigation. But failure to consider key factors could result in incomplete analyses, regulatory criticism, or other enforcement actions.

In the current regulatory landscape, financial institutions are facing a new wave of regulatory scrutiny with no signs of slowing down; in fact, the main focus recently has been on the effectiveness of the control mechanism together with front line awareness, even when no financial crime has actually taken place.

This workshop considers the challenges and the solutions available to ensure AML escalations are both effective, manageable and most important of all “get the job done” in a regulatorily compliant and effective way.