Preparing Your Financial Institution for Compliance with FinCEN’s Customer Due Diligence Rule
Identified gaps should be prioritized for remediation.
Conduct a gap analysis to identify any gaps between existing policies, procedures, processes and controls, and the requirements of the CDD Rule.
Determine which functional area, governance forum, or committee in your organization should be responsible for overseeing and sponsoring the implementation, and determine how and when updates should occur, and include progress and completion deadlines.
Based on the gap analysis, prepare a formal project plan for implementation of the changes that will be necessary, and identify those changes that require the most lead time.
Develop and implement an open line of communication with your information technology team to assess and evaluate changes in technology that might be required at both on-boarding and transaction monitoring, and create a timeline to ensure critical path actions are identified and scoped early.
Compliance officers should socialize the new rule with senior compliance and business management, and include those responsible for technology planning and budgeting.
Consider providing an update to sales or similar staff who may be impacted by answering client questions.
Policies and Procedures
Revise written policies and procedures and account opening forms to incorporate the CDD Rule’s requirements.
Develop, document, and deliver training that explains not only the requirements of the CDD Rule, but how the firm is revising its policies and procedures to ensure compliance with the rule.
Consider customized training for different areas of the firm (i.e., account managers, onboarding functions and compliance).
Conduct user acceptance testing to ensure the information technology systems are ingesting and incorporating all required information into the onboarding process (customer risk profile), recordkeeping, transaction monitoring, suspicious activity investigations, and reporting process.
Leverage internal audit resources and conduct testing within three to six months after implementation of changes and enhancements.
Time is Up!
UNTIL THE CDD RULE GOES INTO EFFECT
Have you completed all the steps above?
Navigant’s team of experts have the experience to assist financial institutions in implementing changes and revisions to their existing policies, procedures, and controls. Navigant can provide your institution with highly skilled resources for the short-term implementation of these regulatory changes until your financial institution has incorporated such changes as “business as usual.”
contact us today