SHOULD SPONSOR BANKS CREATE INTERNAL CLINICS FOR THE COMPLIANCE STAFF AT THEIR FINTECH PARTNERS, TO INSURE THAT EFFECTIVE AML PROGRAMS ARE OPERATIONAL?

Given the fact that the compliance programs in place at many fintechs have come under attack, for being sub-standard or ineffective, especially when it comes to anti-money laundering, should not sponsor banks take the bull by the horn and conduct compliance clinics to remedy the deficiencies? Full day programs, offered specifically by each sponsor bank to its fintech partners, would focus on customer identification procedures, transaction monitoring, money laundering tradecraft, and other relevant subjects that have been identified as fintech compliance shortcomings, to elevate the proficiency of each individual fintech compliance officer, and thereby reduce risk levels at sponsor banks.

A one-day in person program, and definitely not virtual, would foster the frank exchange of information, identify specific problem areas, and serve as a forum for fintech compliance officer feedback. Sponsor banks should use not just their own compliance staff, but industry experts to round out the program and keep it interesting, which would attract attendees. A document confirming attendance, and certifying it, could be an Important part of the continuing professional education of those fintech compliance officers, as well as further develop the relationship between fintech staff and compliance officers at their sponsor bank.

Finally, since so much of what sponsor banks do in the compliance sector has mitigation relevance, such a program, when presented to regulators in responding to any future compliance issues, could even serve to reduce or eliminate ultimate civil fines and penalties contemplated by regulators; think seriously about establishing such a program.