Why is compliance so interesting?
This article is dedicated to all the Compliance Officers who have passion and dedication to do what’s right! The goal of Compliance is to keep a firm out of regulatory trouble. And believe it or not, it’s not all glitz and glamor. Sometimes we need to get our point across to different areas of an organization. It requires us to use our influence and persuasion skills. These skills are key. Compliance has been called the police, anti-establishment folks (mostly from the front office), and other names that I won’t repeat here.
More Than Just Rules and Regulations
People don’t realize that Compliance is so much more than rules & regulations. There are so many interesting topics that we often overlook. How can money laundering, fraud, bribery & corruption be boring? It’s not!
Real-Life Drama: The "Catch Me If You Can" Example
How many of you have watched the movie “Catch Me If You Can?” Believe it or not, this movie was about Bank Fraud. Frank Abagnale Jr. performed cons worth millions of dollars. He posed as a Pan American World Airways pilot, a Georgia doctor, and a Louisiana parish prosecutor. I can’t make this up! We can learn a lot from stories like this, especially people who work within banking operations.
Learning from the Misfortune of Others
This is just one example of how Compliance can be very interesting. And believe it or not, there are so many more stories. The good thing about working in Compliance is that you never run out of content. There are always people, firms, and criminal types that come into the crosshairs of law enforcement and regulators. Compliance is here to discuss these problems in our organization so we can learn from others' misfortune. What if we encountered an issue that other organizations have incurred? Can I find a story to tell? Of course. Regardless of the area of Compliance, there have been infractions along the way in every area. We need to be motivated to do the necessary research and uncover these stories.
Case Study: Bribery and the FIFA Scandal
How about bribing a public official? I recall having an issue at a prior firm where someone in sales was accused of bribing a public official in order for our firm to win a sizeable bid. I wanted to find an instance where something similar occurred, and I found it. In May 2014, 14 high-ranking officials of the Fédération Internationale de Football Association (“FIFA”) were arrested and charged with 47 counts of crimes, including racketeering, money laundering, and wire fraud conspiracies, among other similar crimes. Enforcement officials claim that the group of defendants engaged in a 24-year scheme of enriching themselves through bribery, kickbacks, tax evasion, and other corruption in international soccer. The defendants, who hail from the U.S. and South America, committed these illegal acts to obtain lucrative marketing and media rights to international soccer tournaments all over the world. (Source: Bribery - Definition, Examples, Cases legaldictionary.net)
The Art of Relatable Storytelling
The reason I brought up this particular example is due to the timing of the World Cup. It worked out perfectly. I told the story and related it to our situation. I could see the interest based on verbal clues and body language. Storytelling is only one part, but relating it to our audience is where you capture people’s attention.
I can go on and on about movies portraying real-life stories (or, as Hollywood says, it's based on real-life events) and circumstances that occurred at other institutions. There is so much material we can work with. We need to utilize this content effectively and create an atmosphere of trust and respect.
The Rise of Explainable AI
The demand for explainable AI will grow proportionately, enabling a financial institution to justify the entire AI decision-making model. This actually improves trust and transparency of the entire AI integration into AML and fraud tools.
A Message to Members of Compliance
As I’ve illustrated with these two examples, the material is there! You need to leverage it and be a storyteller with a point. If there is no point, it's like telling a joke without a punchline. Good storytellers understand the content and can convey it in a manner that gets the point across. Take the extra time and do what’s best for your stakeholders. Remember that we can always improve our culture of Compliance and reduce this risk in our atmosphere in different ways. If you have a chance, hug your compliance officer! They deserve it!
About the Author: Justin Muscolino
Justin Muscolino, CEO, High Risk Education Justin brings over 20 years of wide-ranging experience in compliance, training, and regulations. Most recently, he served as Head of Compliance Training at Bank of China, where he led the compliance training function and created and monitored the annual training plan through a thorough training needs analysis. Previously, he served as Macquarie Group’s Head of Americas Compliance Training and JPMorgan Chase’s Compliance Training Manager. Justin also worked for FINRA, a US regulator, where he created Examiner University to train examiners on how to perform their function.
