Policy Highlight: Anti-Money Laundering - OFAC
NLP AI is a promising technology, but until it is given some more time, advanced context-sensitive policies are one of the best tools available for effective E-Comm Surveillance.
Whether fulfilling regulatory requirements, investigating and uncovering fraud, or combatting the risks of the DLP world, flexibility is imperative when capturing and supervising user behavior. For obvious reasons, if the surveillance model is too loose, all the invested money, time, and effort is for naught due to the overwhelming number of false positives to review. If the surveillance model in place is too strict, you might capture everything you set out to capture (great), but miss items due to an oversight in how the policy was constructed.
All too often a “one size fits no one” model is used to conduct surveillance. The same cookie cutter policies are implemented without regard for the unique needs of your firm. The same phrases continuously bog down the review process as other pertinent communications get lost in the volume.
Creating a matrix of context-sensitive policies builds a complex labyrinth that produces a high-quality surveillance model. Following up with a regular refinement schedule to not only sift out the junk filling the review queues, but also capture communications that previously skirted the policies in place or close gaps based on regulatory changes (or incidents).
Anti-Money-Laundering – OFAC policy in particular needs consistent maintenance to keep it accurate, relevant, and valuable. According to FINRA Rule 3310: “Each member shall develop and implement a written anti-money laundering program reasonably designed to achieve and monitor the member compliance with the requirements of the Bank Secrecy Act and… by the Department of the Treasury.” Additionally, the Office of Foreign Asset Controls (OFAC) administers and enforces economic and trade sanctions against foreign entities based on US foreign policy.
This specific policy requires a two-step approach. First, consider the current sanctions being enforced by the Department of the Treasury (reminder that these can change daily). Second, apply the understanding we have of the language used around money laundering. If communications arise from US-sanctioned areas that contain phrases like “transferring money,” “move account,” etc., the policy flags the event to be reviewed.
Implementing a first-rate “Anti–Money Laundering – OFAC” policy and the language targeted is an obvious first step for any compliance officer, but the work doesn’t end there.
It is critical that a refinement and maintenance schedule is applied. Do your policies automatically update to match any changes to the OFAC sanction list? Do you have the capacity to keep your policies up to date with the natural evolution of language itself? Do the capabilities exist to refine out the pesky false positives bogging down the system? Are there key phrases you know are going undetected?
To operate a successful supervision process, you must maintain and progress your supervision policies and scope based on current firm activity and regulatory changes. Under the Technically Creative Policy Program, we work with you to define and create targeted policies on past, present, or future matters.
To learn more about Communication Surveillance Policy and Rules, schedule a 15-minute discovery call today with Technically Creative Experts. Contact us at GetInfo@technicallycreative.com or visit us at https://technicallycreative.com.