money transfer agents: know your customers!

Agents: Know Your Customers!

2014 Consumer Protection & Compliance Conference

Consumer Protection & Compliance Conference

2014

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Objectives

Enhance risk management practices to better mitigate risks

Protect business and make it more profitable

Protect and serve your community – be a good citizen

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Suspicious Activity

• Prevent• Detect• Report• Assist

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2014

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Culture of Compliance

Signs of a lax, Non-Compliance Culture?

FinCEN’s Culture guidance – FIN-2014-A007

Advisory to U.S. Financial Institutions on Promoting a Culture of Compliance

Engaged Leadership

Compliance not compromised by revenue interests

Appropriate internal information sharing

Adequate Human and Technological Resources

Effective Program- Independent, Competent Testing

Understand importance, utility of reporting

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2014

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Hard Target OR Soft Pushover

Do not compromise yourself

with exceptions

poor documentation

lack of focus or willpower

Will you be a wet noodle? Man or Mouse?

Official government ID - real, current

not expired

not international driver’s licenses

not “for novelty purpose only” ID cards

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2014

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Customer Identification ProgramEstablishing a reasonable basis to believe person is who he/she claims to be

Mickey Mouse? Elvis Presley? (I think not….)

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2014

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What does KYC look like?

Before you can Know Your Customer, you need to know your market.

How do I recognize a customer when I see him/her?

How do I distinguish a person coming in to buy something that I don’t want to be a “customer”?

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2014

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Solid Understanding of Market

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What is normal & expected?

Socio - Economic profile

occupation

education

income

ethnicity

dress

speech patterns

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Socio-pathic profile

prevalent problems and issues in our neighborhood

familiarity with types of people who may be

perpetrating crimes in our neighborhood

familiarity with types of victims locally

Who is being taken advantage of in our

community?

What is normal & expected?

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Good Customer Interface

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STOP!

Don’t be distracted

Make eye contact

Pay attention

Be alert

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Look!

Be observant

Really look (not just see)

Observe demeanor

Detect signs of deception

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Listen

Clear questions and answers

non-threatening

casual alertness

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2014

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Who is this person?

Be friendly- you want customers to come back

Details- employment, occupation, title, where

other identifiers

does person actually live/work nearby?

family, friends, business associates, related customers

What might that tell us?

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What services?

Used, inquired about

Cross selling is good business practice

helps understand customer too

may also help identify red flags

Does person meet profile of what is expected for market?

Does timing, frequency of transactions make sense?

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2014

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Levels of Knowing

New customer – simple remittance

Repeat remittance customer

Detailed information gathered from multiple tranx types

No interaction

Moderate interaction

Closely held, limited openness

Too open

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2014

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Training - Ongoing

Training –

not just once a year

can’t set it and forget it

do risk based refreshers throughout year

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2014

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Role Playing

Isn’t role playing just another way of…

inspect what you expect?

Allows you to demonstrate how to handle real life

scenarios effectively

Mystery shopping can help prove whether training is

effective or not

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2014

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Front Line Fraud Protection

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2014

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Elder Abuse

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Human Trafficking

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2014

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Drug Trafficking

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2014

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Thank you

Jay Postma, CAMSPresidentMSB Compliance Inc.Jay.Postma@MSBComplianceInc.com

John Schmarkey, CAMS, CFEBSA/AML Compliance SpecialistMSB Compliance Inc.John.Schmarkey@MSBComplianceInc.com

www.MSBComplianceInc.comwww.Twitter.com/MSBCompliance

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