Tuesday 10 August 2010

A Complete Compliance Solution to KYC

One of a number of ways jComply can support clients in meeting their FSA requirements is with KYC. But what should KYC cover?

Whilst surfing the web for KYC solutions I am inundated with solutions to support anti money laundering, this is certainly a part of the issue but by no means the entire solution.


What Does Know Your Customer - KYC Mean?

A standard form in the investment industry that ensures investment advisers know detailed information about their clients' risk tolerance, investment knowledge and financial position.

KYC forms protect both clients and investment advisers. Clients are protected by having their investment advisor know what investments best suit their personal situations. Investment advisers are protected by knowing what they can and can not include in their client's portfolio.

So protection covers both sides of the desk. On the one hand, the financial institution needs to understand the client not just for their own corporate governance but just as importantly to understand the clients needs too.

Many of our financial clients have turned to jComply to support the management of their policies and procedures. Take a look at the client reference at http://www.youtube.com/watch?v=EbmjJx07xJM.

Here, our client began to use jComply to support training of staff in policies and procedures however, by working with Tabaq's post sale consultancy team a number of further usages have been prescribed.

An area that was expressed as a concern during a recent visit to Central Markets had been with client suitability. A paper based fact find is currently carried out with the prospective client over the telephone, with a suitably qualified interviewer.

Depending on the outcome of the questionnaire a decision is taken as to the suitability of the applicant to be a client. This could be granted immediately, referred to a more senior manager or lead to a decline.

Some training is available to support the claim of the applicant that they are suitably aware of the derivatives and spread betting market.

By developing an electronic fact find form within jComply, the current paper based system could be improved.
The e-form system will ensure that all mandatory sections are completed satisfactorily, the e-form itself would be version controlled, a full auditable and time/date stamped version is recorded and stored within jComply and all answers could be linked back to a weighted response, signalled as red amber or green to highlight suitability by way of corporate standards rather than an interviewers own subjective interpretation.

Leading on from the fact find, the question library could be extended to an application section, where applicants are given a password to enter into the training section to understand derivatives and spread betting and of course eventually take an examination.

This would identify all acceptable clients to an external auditor through the auditing features within jComply.

All of these actions are achievable within the standard version of jComply and the e-forms module.

The deliverables are obvious and include:
• A complete reduction of paper.
• Increased security of client data.
• All applications are controlled within the secure environment of jComply.
• Subjectivity is reduced assessing the suitability of a client for certain types of trading.
• The applicant is taken through a thought provoking, self assessment that will encourage fair trading all round.
• Accessibility through a secure web link enables access through a secure log in from anywhere.
• eMail notification and time nagging features ensure an application is carried out in an appropriate timescale, convenient to both client and broker.
• Integration into existing Customer Relationship data base ensures consistency of client information.
• Workflow to senior managers for exceptions only, reducing none relevant applications.
• Automatic notification that supporting application information has been sent such as age consent forms.
• An efficient and effective way to demonstrate client due dilligence.

Of course, anti money laundering is still important an as such we have designed an additional e-form to cater for AML reporting thus improving the way the client carries out SAR's ( suspicious activity reporting). Once again the inbuilt workflow and security area within jComply provides an excellent method of achieving SAR's regulations for front line workers.

Certainly this solution has driven down the cost of governance at our client and will do so whilst improving the effectiveness of the FSA compliance process.

For more information or a demonstration visit http://www.jcomply.com/
or email sales@tabaqsoftware.com
Or telephone 01344 668400

Monday 9 August 2010

What are the benefits of BPM in Compliance?

Business Process Management has been around for some time. However it has often confused potential customers rather than making it easy for people to adopt BPM to reap the rewards of process automation.


What is BPM?

Business Process Management is a management approach to improve the business processes in order to make them more efficient, effective and agile or quick to change as and when needed. Technology based BPM systems or suites have enhanced the concept by providing GUI design environments which even the non-technical people can use to design or model their business processes. This has tremendously increased the application of BPM to a wide range of business processes. Especially the processes that require large volume of transactions, or complex collaboration and integration with disparate systems, or rules based decision making, or transactions that require full audit trail for compliance are best suited for BPM.

There are a number of BPM technologies out there, from high priced third party software to open source BPM suites. Open source solutions tend to offer the best of both worlds. Not only they are free to use but open source solutions like jBPM and Process Maker come with GUI development environments and plug-ins to make the life of a business analyst real easy.

How can BPM benefit compliance?

Business process improvement is continuously ranked as the top business priority by business managers, according to a recent survey. There are many options for improving the business processes – ranging from complete process re-engineering to adopting new process management methodologies, such as Lean Six Sigma, or adding new capabilities to existing system. An investment in the right BPM suite can enable an organisation to embark on a sustainable business process improvement programme.

Mikel Harry, one of the founders of the Six Sigma methodology, has documented the economic impact of focusing on process improvement. Using the base measure of his methodology – Sigma, Dr. Harry provides a tangible example of how companies like GE have benefited from a commitment to process improvement:

With just a one-sigma shift, companies will experience a 20 percent margin improvement, a 12 to 18 percent increase in capacity, a 12 percent reduction in the number of employees, as well as a 10 to 30 percent capital reduction.
(Source: Six Sigma: The Breakthrough Management Strategy, Mikel Harry, Richard Schroeder)

The core benefits of BPM include efficiency, effectiveness and agility. The first benefit seen of a business improvement is that of improved efficiency. For example, Darlington Borough Council realised savings of 1,000 hours when they moved their manual accident and incident reporting (including manual data entry to MS Access database) to jComply Accident and Incident Management Module.

As the efficiencies are realised, the organisation focuses on making the process more effective. Often inconsistencies and loop holes are realised when the new processes are implemented. For example, in a healthcare organisation, patient pathway was reduced to 18 weeks (nearly 25%) as a result of cancelling the repetition of tasks performed in two different departments.

One of the most useful benefits of BPM is that organisations can continue to change and adapt their business processes to the changing business needs. Agility is a well known concept in a more technical arena of Service Oriented Architecture (SOA). Some of our customers change their processes a few times a year. The cost on the process change so insignificant, it is easily superseded by increase in efficiency, effectiveness and conformance to regulations.

Merging BPM with Compliance

jComply BPM is a compliance application based on a Business Process Management Suite. jComply has all the features of an enterprise compliance application such as policy and procedure management, version control, reusable question library, eLearning, audit trail, scheduling, escalation and reporting. Combining the compliance features with BPM Suite, has powered jComply with workflow based task management and real time notifications to produce solutions such as the following:

• Accident and Incident Management

• Know Your Customer forms including Client Fact Find and Customer Due Diligence

• Health and Safety checklist and reporting

• Risk Assessment form

• Supply chain procedure management

To learn more about jComply, visit http://www.jcomply.com/ or email sales@tabaqsoftware.com or call +44 1344 668400.