In June 2019 we presented our study on how the Risk Based Approach (RBA) can be used to convert the entire process into a profit centre at the ACAMS conference in Berlin. A room full of compliance analysts and MLROs. A study based on the findings and research we have done on our current client base over the past two years.
We see various companies adopting various approaches to doing the risk based approach on all their subjects. The most common is the famous excel sheet with never-ending rules, calculations, figures and weighting on all aspects of risk. Excel sheets are a manual process that require a lot of human effort to input and maintain for each subject. Based on static data that needs to be manually changed per sheet. We also see customers who are willing to use some risk engine that happens to be available within an existing product that they use which often leads to having to adapt the internal process to the system being used. Another very common approach to risk is the "I know all my customers" syndrome whereby the processes are so lax and risk reviews are almost non-existent as the organisation bases the facts on the close personal relationship that they have with subjects.
However based on statistics, we can confirm that having a robust, central automated risk based platform at the core of the entire process of lifetime due diligence will not only reduce the risk to perform the risk based assessment, but will also maximise efficiencies all throughout the entire due diligence process of the company.
The presentation below (being the study that we presented at ACAMS) shows the detailed areas that such an approach will help with. Areas that would be impossible to achieve without such a platform. From reducing the risk exposure between reviews, application of regulatory changes on all subjects in real-time, the ability to link workflows to instant risk updates and also streamlining the on-boarding process using the real time perception of risk for ultimate efficiencies and also removing the element of human bias in risk assessing subjects. The study also presents the importance of a solid Risk Based Approach system as an underlying structure to achieve all this. The importance of a fully dynamic regulatory process and being in full control of the data collected and the definition of risk on each field are crucial to the overall process.
KYC Portal is the first product on the market that has been specifically designed around risk. A system that allows you to configure the entire risk configuration based on your particular services or products, tailor made to each and every aspect of the regulatory process. This automated risk engine is crucial to the success of any due diligence process as it leads to increased efficiencies whilst reducing the overall risk.