ABN Amro reuses compliance tool for global risk assessment project

Investment bank ABN Amro is using technology it developed last year for ensuring regulatory compliance to help it conduct a broad-based risk reassessment of its global client base.

Investment bank ABN Amro is using technology it developed last year for ensuring regulatory compliance to help it conduct a broad-based risk reassessment of its global client base.

The bank is using the web-based development tool to automate processes and improve its workflows for reviewing existing clients. This should provide a better understanding of the risks it is exposed to by particular client segments, said ABN Amro.

The review is particularly pressing as last December the bank was handed a £45m fine for “deficiencies” in its US-dollar clearing activities at its New York office, as well as violations of US regulations about managing foreign assets at its Dubai branch.

The payout followed an independent investigation that uncovered how, between 1997 and 2004, there were instances of employees circumventing internal processes to make US-dollar payments from and to countries such as Iran and Libya. The countries were on a list of “sanctioned” states maintained by the US Office of Foreign Assets Control.

The bank expects to have completed the risk-reassessment project before the end of the year, potentially opening the way to broader applications of its user-view technology, which it developed in partnership with Edge IPK.

Last year, the bank told Computer Weekly how it planned to use Edge IPK’s Edgeconnect application for business relationship monitoring and filtering. It initially trialled the technology to enable its ABN Amro Trust unit to respond more easily to global compliance requirements on monitoring for international money laundering activities.

Tony De Bree, a project manager at ABN Amro who is developing new ways to use the tool, said the potential of the system’s flexible front-end presentation layer to replace traditional customer relationship management systems was yet to be fully exploited. However, the success of the project could open the way to more ambitious deployments.

In particular, he said the application could have a role to play in meeting the demands of forthcoming legislation such as Europe’s Markets in Financial Instruments Directive.

“The solution we developed last year with Edge is very broad in its scope and could potentially help the bank’s staff work in different ways,” said De Bree.

“But first we need to get people to see a world beyond the traditional CRM systems, and that takes time because it goes against the grain of the IT industry, which continues to push these large and complex systems.”

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