Podcast - Running a Successful Financial Crime Programme in Financial Services

Podcast - Running a Successful Financial Crime Programme in Financial Services
Running a Successful Financial Crime Program in Financial Services

 

Josh Heileczer chats with Scott Burton, the APAC Financial Crime Head at Deutsche Bank. Scott delves into why persistence, transparency and a holistic view of Financial Crime are imperative to run a successful programme.

Protiviti Podcast Transcript Transcript

Josh

Hello and welcome to the Protiviti Podcast on Risk and Compliance. I’m Josh Heiliczer, Managing Director for Risk and Compliance here at Greater China at Protiviti. I’m glad to be joined by Scott Burton from Deutsche Bank. Scott is the APAC Anti-Financial Crime Head and, previous to that, has a lot of experience at a number of different institutions here in APAC. So, really happy to be with Scott today. Thank you for joining us.

Scott
Hi, Josh.
Josh
Scott, a number of compliance professionals are listening to podcasts. You have a really distinguished career going from Australia. I think last time we talked about how you had those boots coming from a rural farming area in Australia to ultimately London, Hong Kong, a lot of different places, and you were head of Financial Crime at Credit Suisse globally. Then you went over to JP Morgan and now you’re at Deutsche Bank. Can you just tell us a little bit about your career journey?
Scott

Yes, sure. Not so much of rural farming area but a beach area, somewhere that’s pretty relaxed, pretty laid back. So, I would have to say that this career wasn’t something that I would have anticipated when I was thinking as to what I wanted to do when I grew up, that’s for sure. I think the career journey particularly into financial crime was one that first started a little over 20 years ago. So, I had an opportunity to do some project work. I was working at a consulting firm prior to joining what was Credit Suisse First Boston in Hong Kong and that was to - and establish a KYC programme for the bank in Asia. I thought, “Look, this sounds great. It sounds like a good opportunity to be an in-house project person. I’ll do it for a year or two and just see what happens from there.” So, a little bit ad lib, but this was just prior to September 11, the Bali bombings and all that stuff in the early 2000. This was in the late 90s and I had no idea what was happening next and I thought that this would be something that would just be a stepping stone into I’m not quite sure what, but an opportunity to work in Asia and to broaden my horizons. I did this project and that was in conjunction with the compliance and operations areas, establishing a KYC Control framework for the bank across all the jurisdictions that they were operating and analysing the rules and regs and making sure that we had, as part of the account opening process, collecting the right documentation. This was at the very early stages of what everybody sees as normal course of business these days. That’s where I first got into this area and it was off the back of my previous consulting experience, due diligence experience with consulting firms. I had worked on the investment banking side as an analyst. This is where I first landed and jumped into this area. It then sort of rolled on from there as a result of developments - September 11, Bali bombings, et cetera, where the organisation that I was working with the at that time realised that they needed compliance people in this space. So, it was pretty much green fields. I was the person in Asia to be full time in this area. It’s always a part-time role for people that were doing broader compliance roles. Then it just grew from there. I joined the compliance function at CSFB. They all grew to cover all of the Credit Suisse here in the region including the private bank and then ultimately to become the global co-head for financial crime at Credit Suisse. I then moved on to JP. That was a role that very much involved transforming the Financial Crime Programme there which was a challenge over a four-year period, developing a team, making sure that we had the right controls in place. I think everybody would be aware at that point in time they were under a lot of scrutiny from the regulators in the US and I needed to develop the Financial Crime Programme and my experience helped to make sure that the right controls were put in place, a team was built and that was certainly an enjoyable experience. Deutsche Bank, I’ve been there for four years now, the regional head of Financial Crime, and again working very hard to continue to improve the programme there, to develop the team, to make sure that we got the right controls in place and that’s effectively been the journey over the last 20 years now.

Josh
Yes, Scott. I think that’s really great. I find, from my experience, my career as well, different projects that I have done whether it was exposure to transaction monitoring early on or working in a different area when I was exposed to correspondent banking at Citi and Bank of America. Those types of transformation projects, I think, for a lot of young professionals are really keys to understanding where your niche might be within the financial crime field, understanding whether or not it might be the right place for you, but also having the ability to be versatile in your skill set as well. So, it is really important. You mentioned projects and transformations. One of the things that I think is really difficult working out here in Asia, I’ve seen it now in the over 10 years since I’ve been out here is that if you were working for a bank that’s headquartered in the US or Europe, it’s not headquartered necessarily in Asia or in Hong Kong, it can be very hold to get your needs prioritised just because you’re in a time zone out here in the Far East and the regulator might not be breathing down your neck as hard as it might be breathing down your neck in the US or Europe or UK. So, how do you go about really getting your needs prioritised in the global agenda and what you need to run a successful programme?
Scott

It’s always a challenge and I think there’s a number of things that you need to consider, a number things that you need to do and just going through them and just off the top of my head, I think planning is important, persistence, clearer articulation, making sure that you can articulate the pros and cons, the cost and benefits of doing something or not doing something. Just going back to these, I think planning, I spend quite a bit of time thinking about what we need to do here in the region. If we can’t get technology at the time that I would like technology here in the region, what do we do to mitigate the risk? Making sure that you’ve got a clear direction and a clear strategy here in the region, being persistent with our global colleagues and counterparts in terms of making sure that the agenda that we have here in the region is front and center for them too and for it not to drop off the table, making sure that I get the management’s support here from the business here in the region, to make sure that our needs are met is also an important criteria or important thing to do as well. Reiterate again that look, it is a challenge and sometimes it could be fires burning in other regions that puts your needs further down the list, but as I mentioned before, persistence is key. Then when you’re putting your business case forward, making sure that you’ve outlined what the pros are, what the cons are of doing things. What the costs are, what the benefits are? You’re making it clear everybody’s aware of that if we don’t do something then this is what a potential outcome would be and is everybody comfortable with that? It could be much easier. You could have some regulatory pressure to do something here in the region and that obviously makes things a lot easier to push through.

Josh

Sure. In terms of Asia itself, Asia is really a growth area for Deutsche Bank clearly now. Everybody is trying to move in to China on a more greater basis at this point, hiring from a business perspective is moving forward. How do liaise with the regional regulators say MAS or HKMA or others on some of your regulatory priorities? It might be true that out of overseas – and I know when you were at JP Morgan you were working significantly on the US OCC issues. How do you deal with that? How do you let them know what’s going on and how that’s going to affect Hong Kong, Singapore or other areas in Asia?

Scott

I wouldn’t say it’s a challenge per se but it can be complicated in terms of being able to clearly articulate the situation. I think it’s very important to be as transparent as you possibly can. Sometimes there’s restrictions as to what you can and cannot say from a legal perspective but working with your global counterparts to be as transparent as you possibly can in terms of what the issues are and what, if it’s a global bank, is doing from the global perspective to deal with the particular issues that they have, and how that specifically impacts a local jurisdiction. Sometimes, to draw that out all global projects, sometimes it’s very easy to, sometimes it’s not so easy to, and to be able to do that promptly, and to be as comprehensive as you can, and the way that I’ve always tried to do this is to organise it in a way to say, “This is what we’re doing from a global perspective.” In addition, these are some of the things that we’re looking to do regionally which will impact this particular jurisdiction. Here’s some specific things as well that we’re trying to do from a local jurisdictional perspective and try to put that plan together to make it more clear as to how everything fits together.

Josh
Yes. I think, Scott, you made some really great points in terms of how you’re able to prioritise and work with regulators and one of these that I’d like the audience to take forward most of all especially if you’re working the Risk and Compliance space then in Financial Crime is that really these regulatory projects are great opportunities for you from a career perspective. You can learn so much. You can learn and liaise with a lot of different stakeholders, much more than if you’re siloed and working in a particular space, maybe covering an area or aspect of financial crime. So, I would say to you, if you can volunteer to take some of these projects up and work on them, that will be time consuming but it will also be very rewarding from a knowledge and a career perspective going forward.
Scott

I agree. I think what I encourage is for people to take stretch assignments where they can. I think, from a career development perspective, that it’s really important to get exposure to as many areas of financial crime as you can. I think just because of the way that our area of expertise has grown that people have become very specialised in sanctions or in bribery and corruption, for example. There’s not a lot of people out there that have more understanding of the different areas of Fin-Crime. I think it’s okay also to be as strict as they may in a certain area but there is also certainly demand for people, and particularly as you get more senior, you have to really have experience across the variety of areas in Fin-Crime and this is the way to do it.

Josh
Sure. I think the best transaction monitoring investigators or analysts, the best KYC analysts, the best people working on source of wealth or sanctions are those people that are able to look at things in an interrelated in interconnected the level, and maybe they’re able to spot a risk factor whether it’s fraud or a bribery and corruption case from looking at something that might be an alert in a different context or a red flag in a different context, and building on those cases.
Scott

Holistic view is really important and then it even extends further to some of the other risk-types outside financial crime as well and people with that ability to identify those risks, that’s where there will always be a demand for people with that skill set.

Josh

Absolutely. You heard it from Scott first. That’s how you can make yourself valuable in the AI and computer age. Scott, thanks a lot for joining us here on the Risk and Compliance Podcast at Protiviti. This is Josh Heiliczer and I’ll be with you next time. Thanks a lot.

 

Ready to work with us?

Josh Heiliczer
Joshua Heiliczer
Managing Director
+852 2238 0400
Linked