How we are fighting financial crime

We’re putting our efforts into four areas: 

The right controls

Ensuring our compliance systems match the risks inherent in the markets in which we operate.

Our point of view

"We want to be the best international bank, and we recognise we cannot be that bank without being a leader in fighting financial crime. It's not one or the other. And a core part of getting that right is developing controls that take into account the risks that we face as a bank around the world."

Patricia Sullivan, Global Co-Head Financial Crime Compliance

The right controls

Ensuring our compliance systems match the risks inherent in the markets in which we operate.

Our point of view

"We want to be the best international bank, and we recognise we cannot be that bank without being a leader in fighting financial crime. It's not one or the other. And a core part of getting that right is developing controls that take into account the risks that we face as a bank around the world."

Patricia Sullivan, Global Co-Head Financial Crime Compliance

We’re working hard to ensure our business is backed by robust financial crime compliance efforts that address the inherent risk of the people, companies and markets that we serve. To enhance our financial crime controls, we’ve made substantial investment in new systems and processes, in training for our frontline and compliance staff, and in our people. But we know that we need to continue to innovate in order to help to keep the financial system secure from criminals and terrorists.

2018 saw the roll-out of some important new tools and processes that have the potential to transform the efficiency and effectiveness of our approach, following a number of successful proof of concepts.

New machine learning technologies offer possibilities to crunch vast quantities of data quickly and to finetune our financial crime surveillance tools; crucially freeing up time for specialists to investigate potentially suspicious behaviour and transactions.

And as technology gives criminals a growing arsenal of digital tools to generate and conceal illicit funds, we’re responding by bringing together specialist disciplines inside the Bank across cyber and financial crime. This is spearheaded in the US by our integrated ‘CyFi’ Intelligence unit.

 

Mark Smith

Progress

"The financial crime landscape continues to evolve, and we recognise the need to be vigilant against new and transforming threats as well as adapting to changes in relevant regulation and sanction regimes. In 2017 we built a dedicated Cyber Financial Intelligence team in the US."

Mark Smith, Group Chief Risk Officer

Busy street in Pakistan

Financial Crime Fighters

Financial crime professionals across the Bank work every day to implement the enhanced controls that we are putting in place. This is one story from across our network.

Using financial data to fight illicit organ trafficking | Financial Crime Compliance Analyst, Pakistan

During the transaction surveillance process, it came to light that a client – a jeweller, based on the Bank’s record – had received frequent SWIFT remittances over a short period. Each of these had been credited to his local currency account, and had been immediately withdrawn as cash. A review of the payment details revealed the funds were received from a hospital abroad as commission payments for liver transplants.

Our analyst followed up. The client stated that he is a doctor using his account for remittances from his patients. Yet he was unable to produce any documentary evidence to back this up – such as a medical degree, agreements with the relevant governments, or patient details.

Our analyst escalated the inconsistencies along with the fact that the client had initially not disclosed his actual profile. He also raised his suspicion that the client was carrying out an illegal activity: receiving remittances as commission against human organ transplants. The Bank’s employee disclosed this to Pakistan’s Financial Monitoring Unit, which leads efforts to fight against Money Laundering and Terrorist Financing. The client’s account was exited from the Bank and our systems updated to restrict his on-boarding in the future.

Our Annual Financial Crime Risk Symposium

Speaker at the Annual Financial Crime Risk Symposium

At Standard Chartered, we’re committed to developing our teams working in Financial Crime Compliance. In 2016 we established an annual event, bringing together over 2,000 analysts from our Financial Crime Surveillance Unit and Customer Due Diligence teams to explore new imperatives and opportunities in the fight against financial crime.

A speaker at the Financial Crime Risk Symposium

Instead of sending a few analysts to an external conference, we deliver a high calibre event for our staff, including interactive case studies and external speakers such as Mr. Khoo Boon Hui aka Paul Khoo (former president of Interpol) and Rick McDonnell (former Executive Secretary of the Financial Action Task Force).

Speaker at the Annual Financial Crime Risk Symposium

The theme of 2018’s symposium was “The Analyst of the Future” and the event looked back on the Bank’s journey to strengthen its financial crime controls and ahead to new challenges and the need for analysts to continually learn new skills and knowledge to meet emerging threats. The programme included a keynote speech from Paul Khoo on the financial crime landscape and a focus on the risks of FinTech products and how the Bank is innovating and investing in RegTech to mitigate these risks and make its financial crime controls more effective and efficient.

financial crime

Supporting governance through board level oversight

Some reflections from Sir Iain Lobban, Independent advisor member of Standard Chartered’s Board Financial Crime Risk Committee and former Director of the British Government Communications Headquarters (GCHQ)

Next steps

“We've improved our controls and we want to go further. That means using state-of-the-art technology and data analytics to try and identify those persons and transactions who are really trying to abuse this organisation and launder criminal proceeds. We have a lot more to do and we are committed to completing the job that we have started.”

Patricia Sullivan, Global Co-Head Financial Crime Compliance