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#1371397 - 04/08/10 06:08 PM
Monitoring High Risk Accounts
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Gold Star
Joined: Aug 2005
Posts: 356
Midwest
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We are a small community bank but need to have procedures for ongoing monitoring of high-risk accounts once they are identified. I have addressed customer due diligence but regulators want more specific procedures on hisk risk monitoring. Does anyone have any information they would be willing to share?
I'd like to get this approved as quickly as I can. Thanks!
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#1371407 - 04/08/10 06:21 PM
Re: Monitoring High Risk Accounts
Susielou
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Platinum Poster
Joined: Sep 2006
Posts: 652
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I'll be happy to share what I have. Just PM me with e-mail and I'll send you what I have.
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#1371485 - 04/08/10 07:51 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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Gold Star
Joined: Nov 2005
Posts: 383
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If i can add to this topic.... Once you have your list do you keep folders on these customers? I have a list with name,risk rating, account #'s, entity owner's name, nature of business, EIN, date last review, and whether or not there was any unusual or suspicious activity noted in the review. During an audit was told that I need to have a folder for each customer and make copies of the information that i reviewed. Some of the convenience stores deposit 100 items at a time!! I review 30 days of activity- that includes credits (all items in a deposit) and debits (checks and electronic). By the way we are a small community bank, not located in or adjacent to high risk areas. I'm trying to determine if others are getting this type of request.
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#1371495 - 04/08/10 08:03 PM
Re: Monitoring High Risk Accounts
Susielou
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Gold Star
Joined: Feb 2010
Posts: 356
Middlesex Cty NJ
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I'm in a 5 branch, $120MM community bank, so automated software is out of the question! It depends on how you want to weight different categories when assigning risk (business type, specific levels of certain transaction activity, location,etc.), but I think the EDD process is as subjective as you want to make it. This bank had been using automatic triggers to classify as high-risk (6 CTRs annually, 5 wires, etc., and had way too many 'high risk' accounts until they were convinced that CTRs are a good thing and that every business that deals in cash isn't involved in money laundering. We use the Exam Manual as a guide for review. We look at all the deposited items,and all ACH,debits/checks on the monthly statement for appropriateness for the business type, as well as comparing to anticipated activity when account was opened/reviewed. We also track all cash over $3000 per day for all accounts just for review; any MSBs that aren't classified as 'high risk' get extra monitoring at least quarterly.
_________________________
Lord,give me patience - and I want it NOW!!!
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#1371501 - 04/08/10 08:09 PM
Re: Monitoring High Risk Accounts
nemsi
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Gold Star
Joined: Feb 2010
Posts: 356
Middlesex Cty NJ
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I try to save the trees by reviewing activity on-line; I make a note in the file.The system keeps 18 months worth of statements available.
_________________________
Lord,give me patience - and I want it NOW!!!
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#1371542 - 04/08/10 08:32 PM
Re: Monitoring High Risk Accounts
nemsi
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Platinum Poster
Joined: Sep 2006
Posts: 652
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If i can add to this topic.... Once you have your list do you keep folders on these customers? I have a list with name,risk rating, account #'s, entity owner's name, nature of business, EIN, date last review, and whether or not there was any unusual or suspicious activity noted in the review. During an audit was told that I need to have a folder for each customer and make copies of the information that i reviewed. Some of the convenience stores deposit 100 items at a time!! I review 30 days of activity- that includes credits (all items in a deposit) and debits (checks and electronic). By the way we are a small community bank, not located in or adjacent to high risk areas. I'm trying to determine if others are getting this type of request. I keep a binder with each customer, but, I don't copy all the information. I have a form I fill out that monitors a months statement. I do look daily at the account to see if there is any "suspecious activity".
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#1371547 - 04/08/10 08:35 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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Platinum Poster
Joined: Sep 2006
Posts: 652
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I actually do what "dickr" does. We don't have the software, however, our core processing system keeps information and that is what I use. Our bank is the same size too.
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#1371609 - 04/08/10 09:49 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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10K Club
Joined: Jul 2001
Posts: 81,320
Galveston, TX
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Any auditor that says you have to keep copies of everything you look at is either a little too anal retentive or forgot where they parked their dinosaur when they pulled into the parking lot this morning. Document what you looked at, time frames, etc. Most importantly document your findings and conclusions. If they want to test to see if they concur with your conclusions, then give them inquiry access to your information systems and tell them to have a go at it.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
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#1371615 - 04/08/10 09:55 PM
Re: Monitoring High Risk Accounts
rlcarey
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Platinum Poster
Joined: Sep 2006
Posts: 652
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I definately agree with ricarey. In fact, the High Risk Customer form has exactly that and a place to make conclusions. I don't have enough room to print and file all that......ha
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#1372233 - 04/09/10 07:32 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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Georgia Plum
Unregistered
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Ditto. On-line, document in excel spreadsheet my reviews and conclusions.
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#1372536 - 04/12/10 02:15 PM
Re: Monitoring High Risk Accounts
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Gold Star
Joined: Feb 2002
Posts: 319
NJ
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We have examiners here now, and we are getting similar feedback on our high/medium risk files: create folder, build 'activity profile,' customer history (business location(s), customer base, etc.). Based on this core data, reviews need to be THOROUGHLY documented via written comments: what we looked at, any changes in trend profile, abnormalities and conculsion. Concept is that anyone can pick up the file and know exactly why they're high risk, what actiity to expect, and who's been looking at what.
_________________________
My opinion is free: sometimes you get what you pay for; sometimes you get lucky.
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#1372736 - 04/12/10 06:22 PM
Re: Monitoring High Risk Accounts
Compliance Buzz
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Gold Star
Joined: Aug 2005
Posts: 356
Midwest
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ApacheBelle72, I think the High Risk Customer form is something I would like to take a look at. At least I feel we aren't the only institution that examiners are taking a closer look at this topic.
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#1372766 - 04/12/10 06:48 PM
Re: Monitoring High Risk Accounts
Susielou
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Platinum Poster
Joined: Sep 2006
Posts: 652
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It may be the one I got from the Bankers Tools, I'll send to you now!
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#1372810 - 04/12/10 07:32 PM
Re: Monitoring High Risk Accounts
Susielou
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Gold Star
Joined: Feb 2010
Posts: 356
Middlesex Cty NJ
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If possible, I'd appreciate a copy of the High Risk Monitoring Form as well. Can't locate in on BOL site. Thanks.
_________________________
Lord,give me patience - and I want it NOW!!!
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#1372902 - 04/12/10 09:01 PM
Re: Monitoring High Risk Accounts
dickr
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Power Poster
Joined: Apr 2005
Posts: 3,663
TN
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The FDIC examiner from the supervisory panel at the Tennessee BSA School spoke about this directly as a best practice.
_________________________
I can't herd the cats anymore, so I just set up the electric fences and let them fry when they stray out of bounds.
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#1374355 - 04/15/10 12:10 AM
Re: Monitoring High Risk Accounts
Dani York, CRCM
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Diamond Poster
Joined: Mar 2007
Posts: 2,108
gone fishin'
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I keep a folder on all my High Risk customers - it's easier for me to organize. I do not print out everything - I have a form that tracks Cash, Wires, MI, Float, and ACH activity.
I have verbaige on my form that states:
"I certify that the above activity was reviewed regarding deposits, withdrawals, and all other activity, but due to paper volume, the activity/history was not printed except for any suspicious or unusual activity that was noted at the time, which is attached. If there are no specific activity/transactions attached, then there was no activity to report."
_________________________
My opinions are my own, and not that of my employer.
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#1374505 - 04/15/10 02:29 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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Diamond Poster
Joined: Jul 2009
Posts: 1,448
Flyers Country
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It may be the one I got from the Bankers Tools, I'll send to you now! Could I get a copy too? thanks!
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#1374619 - 04/15/10 03:36 PM
Re: Monitoring High Risk Accounts
madukes
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Platinum Poster
Joined: Sep 2006
Posts: 652
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Madukes, please send me an email and I'll share what I use!
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#1374823 - 04/15/10 06:58 PM
Re: Monitoring High Risk Accounts
abbyauditor
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Platinum Poster
Joined: Sep 2006
Posts: 652
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That is unreal - I've never had them ask for the hard copies. That's scary.
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#1374959 - 04/15/10 09:01 PM
Re: Monitoring High Risk Accounts
ApacheBelle72
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10K Club
Joined: Jul 2001
Posts: 81,320
Galveston, TX
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I agree - very ridiculous. I might call the ombudsman and get an "official" clarification. One field examiner does not the rules make.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
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