Compliance Culture Gaps Pose the Biggest Impediment to Effective Fight Against Financial Crime, Study Finds

Consistent messaging on compliance priorities and additional investments in technology and staff training are needed to reduce AFC penalties across the global financial sector, according to a new report by ACAMS and Oliver Wyman

CHICAGO, May 18, 2021 (GLOBE NEWSWIRE) -- Better technology, additional training and resourcing, and the reinforcement by middle management of the “tone from the top” are among the key steps needed to improve anti-financial crime (AFC) compliance culture, according to a new study by ACAMS and Oliver Wyman. The report—A Global Study Into Anti-Financial Crime Culture: Have We Come Far Enough?—is the result of a survey of 349 professionals, two roundtable discussions with chief compliance officers from major financial institutions and interviews with 11 executives from regulatory bodies and industry trade associations.

The study found that, while most financial institutions and their senior managers have made clear inroads toward improving AFC compliance in recent years, significant steps are still needed to reduce the sector’s exposure to such monetary outlays as the aggregate $14.1 billion¹ in penalties paid for non-compliance in 2020. The most needed improvement, according to 58% of survey respondents, is a greater investment in AFC technology—a change that regulators and others believe could help reduce bureaucratic burdens, free up staff to more directly engage with their regulatory responsibilities and ultimately reduce compliance costs for financial firms.

Over a quarter of survey respondents also said that AFC culture could be improved with more training, additional staff and resourcing, and improvements to how institutions receive and give feedback to law enforcement officials on their efforts to fight illicit finance. Round table discussions highlighted that a stronger effort was needed to ensure that middle management embraced and reinforced the compliance mandates of senior managers.

“This study reveals a number of remaining critical gaps for the financial sector when it comes to AFC compliance, not least of which is the unavoidable conclusion that the biggest problems still facing the industry are cultural, not technical,” according to Shilpa Arora, ACAMS EMEA AML Director and a co-author of the report. “All too often, institutions view compliance as merely having AFC controls, and as such it is not factored into strategic analyses of the trade-offs between its potential risk and return.

“Further investments are needed, but so is greater consistency when it comes to the global application of AFC policies and procedures,” she continued. “Technology and other resources are necessary to give compliance professionals the time they need to do their jobs effectively, but without a coherent and shared compliance culture such tools will never fully achieve their potential of mitigating financial crime risks.”

“One of the most important takeaways from this study is that financial institutions need to spend more time working with, and for, their compliance staff,” said Anthony Charrie, a partner at Oliver Wyman and a co-author of the report. “Only half of the respondents in our survey said that the AFC training offered by their institutions was adequate for their roles, while roughly the same number felt that AFC staff were rewarded for effectively doing their jobs.”

“An institution is only as good as the people working within it and the need for improvements on training and incentives must be a priority for the global AFC sector,” he said.

The study separately outlined the need to strengthen the core components of a strong AFC culture under four categories: (1) strategy and risk appetite, (2) tone from the top, (3) accountability and incentives, and (4) training and communication. Read the full report here: https://www.acams.org/en/anti-financial-crime-culture-have-we-come-far-enough

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¹ Total aggregated bank fines of $14.1 Billion in 2020, compiled by Finbold: The Bank Fines 2020 report - Finbold

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About ACAMS®

ACAMS is a member of Adtalem Global Education (NYSE: ATGE), a leading workforce solutions provider headquartered in the United States. ACAMS is the largest international membership organization dedicated to enhancing the knowledge and skills of anti-money laundering (AML) and financial crime prevention professionals from a wide range of industries. Its CAMS certification is the most widely recognized AML certification among compliance professionals worldwide. Its new Certified Global Sanctions Specialist (CGSS) certification commenced in January 2020. Visit acams.org for more information.

About Oliver Wyman
Oliver Wyman is a global leader in management consulting. With offices in 60 cities across 29 countries, Oliver Wyman combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organization transformation. The firm has more than 5,000 professionals around the world who work with clients to optimize their business, improve their operations and risk profile, and accelerate their organizational performance to seize the most attractive opportunities. Oliver Wyman is a business of Marsh McLennan [NYSE: MMC]. For more information, visit www.oliverwyman.com. Follow Oliver Wyman on Twitter @OliverWyman.

CONTACT: Lashvinder Kaur ACAMS +44 7388 264478 LKaur@acams.org