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#231634 - 08/13/04 03:00 PM
BSA exam - watch out!
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Anonymous
Unregistered
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If you have heard that the agencies are being tough on BSA exams, beleive every word of it. MOU's are being handed out with very little cause. Even if you beleive you have perfection, your program will probabley get critized.
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#231636 - 08/13/04 08:02 PM
Re: BSA exam - watch out!
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Anonymous
Unregistered
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FDIC....harshness is a result of Riggs National
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#231637 - 08/13/04 10:09 PM
Re: BSA exam - watch out!
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10K Club
Joined: Jun 2004
Posts: 19,863
Pulling people out of the ditc...
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you know what rolls downhill. They were lax, banks became lax, they got snubbed, now they are going to go guns to the walls to nail anyone they can.
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Providing alternative truths since the invention of time
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#231638 - 08/14/04 12:10 AM
Re: BSA exam - watch out!
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Anonymous
Unregistered
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Anon,
This is Dolly -I'm too lazy to log in. Hey - where is your bank located? If you don't want to be too specific, give the general area.
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#231640 - 08/18/04 06:50 PM
Re: BSA exam - watch out!
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Junior Member
Joined: Sep 2003
Posts: 48
South Carolina
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Quote:
what types of things they looked at, looked for, what they considered insufficient, etc
I am being examined by FRB as I write this. One thing that they are big into now is risk assessments. Labeling different types of accounts and different businesses and different geographies as high risk and having specific procedures on how customers would be on this list, how they would be monitored and when you would remove them. They also suggested having a "threshold" set for each customer on your list so that if they exceed this threshold that would be an automatic red flag. One thing they said will be on the "best practice list" will be to monitor all new accounts that are opened for 90 days. I don't think they realize that we open over 500 new accounts per month and I'm the only BSA/AML Officer (along with Compliance & CRA). How in the world they think this a achievable is beyond me.
Sorry, I had to vent for a moment. I think I'm OK now.
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#231642 - 08/18/04 09:20 PM
Re: BSA exam - watch out!
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10K Club
Joined: Jun 2004
Posts: 19,863
Pulling people out of the ditc...
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Quote:
One thing you can expect is that your regulator will tell management they need more employees in this area, and they had better be qualifed employees.
BonnieM, I don't mean this as a tag to you, but have you ever seen senior management want to add staff to BSA/Compliance/Audit areas? It is like pulling teeth to get them to staff these areas, as they have high overhead and no return (remember, most sr. mgmt. are revenue/results driven). One way to monitor the accounts opened and closed within 90 days is to make it the responsibility of the account officer who opened the account, and have them do a monthly recap on all closed accounts that were opened by them in under 90 days. There are ways to put these suggestions into place without having all of the burden placed on you.
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Providing alternative truths since the invention of time
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#231643 - 08/18/04 09:23 PM
Re: BSA exam - watch out!
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10K Club
Joined: Dec 2000
Posts: 21,293
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Quote:
have you ever seen senior management want to add staff to BSA/Compliance/Audit areas?
Yes - after a very bad examination report!
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#231644 - 08/18/04 09:26 PM
Re: BSA exam - watch out!
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10K Club
Joined: Jun 2004
Posts: 19,863
Pulling people out of the ditc...
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exactly...as a response to the caca hitting the fan, not as a preventive measure to turn the fan off!
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Providing alternative truths since the invention of time
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#231647 - 08/18/04 09:56 PM
Re: BSA exam - watch out!
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10K Club
Joined: May 2004
Posts: 10,124
Way, way south.
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Quote:
First - let me post this for those who didn't save the infamous KYC proposal:
<a href="KYC Proposal from 1999" target="_blank">http://www.federalreserve.gov/boarddocs/press/boardacts/1998/19981207/R-1019.pdf</a>
This didn't show up as available, is there another place to view it?
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Giddy up.
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#231648 - 08/18/04 10:05 PM
Re: BSA exam - watch out!
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Power Poster
Joined: Jun 2001
Posts: 8,272
Where the heart is
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Try this link:
http://www.federalreserve.gov/boarddocs/press/boardacts/1998/19981207/default.htm
And scroll to the bottom and click on "Summary and Proposed Rule"
Since it's a PDF document, you may just want to go ahead and save it to your computer.
(And remember when we foolishly rejoiced when this proposal was withdrawn?)
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CRCM,CAMS
Regulations are a poor substitute for ethics.
Just sayin'
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#231650 - 08/18/04 10:25 PM
Re: BSA exam - watch out!
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10K Club
Joined: Dec 2000
Posts: 21,293
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Quote:
One way to monitor the accounts opened and closed within 90 days is to make it the responsibility of the account officer who opened the account, and have them do a monthly recap on all closed accounts that were opened by them in under 90 days. There are ways to put these suggestions into place without having all of the burden placed on you.
[quote/]In many places, there is less a chance of that happening then of hiring more staff. 
That was my first thought as well, Bonnie. In some banks the business would suggest that more staff be added in compliance before they would take on that role. Sometimes that can be a way to get staff -- suggest that compliance not do it due to the need to add staff but the monitoring can be done in the business unit!
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#231651 - 08/18/04 10:29 PM
Re: BSA exam - watch out!
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10K Club
Joined: May 2004
Posts: 10,124
Way, way south.
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Thanks for the fixed link. Now my other question, how often should these transactions be looked at in general, and what is a good transaction amount threshold is the general populace using? $5,000? Thanks again.
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Giddy up.
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#231653 - 08/19/04 12:56 AM
Re: BSA exam - watch out!
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Anonymous
Unregistered
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This was our experience also (FDIC - New York office). Prepare for everything: from detailed transaction testing to scrutinizing trial balances...
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#231654 - 08/19/04 05:35 PM
Re: BSA exam - watch out!
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Gold Star
Joined: Dec 2002
Posts: 345
New England
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How large of a bank are you? Are you urban or rural?
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Its risky business, but someone has to do it.
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#231655 - 08/19/04 06:14 PM
Re: BSA exam - watch out!
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Anonymous
Unregistered
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About $3billion urban bank
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#231656 - 08/19/04 07:06 PM
Re: BSA exam - watch out!
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Gold Star
Joined: Mar 2002
Posts: 395
Heaven in comparison to my pri...
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As Bonnie said, your threshold is dependent upon your customer base, account types, transaction activity, etc.
Create a form for branch managers to complete when the accounts have been open for 90 days. Include items such as: account owners, date last visit (businesses), related accounts, type of business, cash transaction activity,wire transfer activity, purchase of monetary instruments, etc.
Have the branch managers (or account officer) complete the form and sign it, then send it to the BSA Officer for review. Based upon your review-classify the risk as high, medium, or low (or whatever rating system you prefer). Determine if you want to continue monitoring the account and when to perform your next review (if any).
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#231657 - 08/19/04 07:54 PM
Re: BSA exam - watch out!
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Anonymous
Unregistered
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My management is adamant that account officers are out there to sell, sell, sell and they don't want them bogged down with monitoring activity, so it is moved to a backroom where an employee who knows nothing about the customer tries to monitor activity. Hmmmmm...
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#231659 - 08/20/04 11:43 AM
Re: BSA exam - watch out!
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10K Club
Joined: Dec 2000
Posts: 21,293
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Quote:
My management is adamant that account officers are out there to sell, sell, sell and they don't want them bogged down with monitoring activity, so it is moved to a backroom where an employee who knows nothing about the customer tries to monitor activity. Hmmmmm...
They should be out selling - or we all go home. But to compensate, you need to establish norms for those customers. That is where a monitoring system can help rather than trying to do this manually. You can set profiles and triggers if things change.
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