Being new to Deposit Compliance I am hoping I can get some help with one of the items listed on my job description. One of the things that they are wanting us to start doing that we haven't been real good at doing in the past is "transaction testing". I am curious as to what other banks do as far as "testing" on the compliance side through out the year in their bank. Some of the things we have come up with are IRA file audits, Safe Deposit Boxes, Interest Bearing Accounts (interest figured correctly) etc.. Of course checking CIP information on new accounts would also be something we would periodically check. Just curious how other banks do inside testing - what types of things checked, how often etc....

Any guidance would be appreciated.

Thanks!

Are you talking about from an audit standpoint or just as the Compliance Officer?

I guess as a Compliance Officer. I guess I am having problems distinguishing between the two. I feel like some of the things I mentioned earlier falls under the auditing department. But then have been told to come up with things that we should be testing as the compliance department.

Deposit Compliance audit may be something that is done every 1-2 years depending on the Bank's risk profile. As part of the Compliance Management System, an institution may also utilize monitoring in between audits. Audit must be performed by internal staff or external vendors that is independent of the function being audited. Monitoring can be performed by whomever the Bank feels has sufficient subject matter expertise to review. Depending on the complexity of the Bank this maybe the compliance area, or the Compliance Officer may delegate monitoring responsibility to individual departments and manage the results. If a significant number of errors are identified, the frequency and size of the sample may need to be increased. Since the risk profile of every institution is different, the frequency of monitoring that you need will differ from every other institution.

Other possible monitoring suggestions:

Regulation E Error Resolution files
Regulation CC Hold notices
Regulation D Excessive Transaction Monitoring - verify that individuals working reports and sending letters are following procedures.
Regulation DD Truth in Savings Disclosures - Test after any upgrades or changes to the platform to ensure that disclosures have not been altered.

Thanks so much for your response BrianC - that does help a lot and gives me an idea of how to begin. Much appreciated!