Risk Assessments Help Protect Your Firm and Focus Your Resources
From insurance managers to banks, to wealth management firms and everything in between, well-implemented risk assessment programmes help focus valuable resources.
Bermuda is a highly respected and successful financial centre recognized globally for its high standards of compliance, regulation, transparency and infrastructure. The Bermuda Monetary Authority’s (“BMA”) supervisory programme is a risk-based one, ensuring that supervisory standards are appropriately focused on the highest risk sectors and on those firms posing the greatest risk. The risk-based approach has been endorsed by a variety of international regulatory and standard setting bodies and demonstrated through the recent attainment of full equivalence with Solvency II.
From insurance managers to banks, to wealth management firms and everything in between, well-implemented risk management programmes are the best way to help your organisation determine how to focus valuable resources. They provide an in-depth understanding of the risk profile for your organisation and lead the way to implementing steps to establish appropriate, risk-based controls.
A successful risk assessment should:
- Conduct quantitative and qualitative reviews of your products, business practices, clients, policies, technology, and structure
- Determine the probability and potential severity of risk events
- Call attention to items that deserve the most focus, conduct a cost benefit analysis for implementing mitigating controls, and create efficient and effective solutions to help you manage your control environment
Risk assessments aren’t just a best practice to help your firm know what risks it is most vulnerable to and how they will be mitigated; risk assessments are also a vital component of your AML/ATF programme. A risk assessment should also include an evaluation of your firm’s AML/ATF risk assessment programme, including KYC procedures and risk rating of client relationships. It should:
- Explore use of technological tools to assist in the KYC process;
- Examine the risk rating process for potential enhancements to ensure proper risk sensitivity; and,
- Ensure robust procedures are in place to establish identity of beneficial ownership.
How Oyster Can Help:
Oyster’s depth and breadth of industry experience provides significant insight when assessing and managing risk. Oyster consultants combine their knowledge to provide a unique point of view of operations, trading, technology, finance and regulation. Oyster can assist you with identifying and ranking the risks associated with the types of business at your firm, and will provide recommendations for policy and procedural enhancements to achieve industry best practices for efficiently controlling those risks.
About the Author:
Ann Daniels is a Risk and Compliance professional with over 20 years’ experience in Regulatory Risk and Compliance in the Financial Services Industry. Utilizing her experience as a Financial Services Regulator, Ann honed her compliance and consulting roles with small and medium law firms, investment businesses, and money-service businesses, including the development, implementation and oversight of Compliance programs. Ann’s experience also includes the development and implementation of AML/CFT risk assessment policies, procedures, and training; automated monitoring systems; risk assessment methodologies; the implementation of standards and a program of oversight of compliance professionals.