The National Money Transmitters Association, Inc. and The Council on Standards and Practices of the NMTA A Basis for Progress - PowerPoint PPT Presentation

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The National Money Transmitters Association, Inc. and The Council on Standards and Practices of the NMTA A Basis for Progress

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Title: The National Money Transmitters Association, Inc. and The Council on Standards and Practices of the NMTA A Basis for Progress


1
The National Money Transmitters Association,
Inc.andThe Council on Standards and Practices
of the NMTAA Basis for Progress
2
Introduction
  • Participation should be voluntary deference to
    state licensing requirements
  • Review and rate any member who desires to be
    recognized for a higher level of compliance
  • System will seek to build on the existing
    independent reviews we are all already paying
    for, by adding two more layers of independent
    desk review, for clarity and completeness

3
Introduction
  • CSP should evolve into the recognized
    professional association for those who do outside
    compliance reviews on MTs/MSBs
  • Peer review is how every other profession and
    industry debates and agrees on standards,
    implements testing, certification, and
    self-policing
  • Members may excel, get the recognition they
    deserve, and give the banks more detailed
    information and comfort when they grant those
    members an account

4
Purpose
  • To establish procedures for
  • Member Admissions
  • Member Rating
  • Member Discipline
  • Standards-Setting
  • Examination
  • Scoring
  • Evaluation
  • Certification

5
Premise
  • The same review we do on our members can serve
    for banks as well
  • The value of the independent reviews we already
    have, can be enhanced by peer certification

6
Why is Rating and Certification so Important?
  • To get us bank accounts
  • To minimize duplication of effort
  • To minimize money, time spent on reviews
  • To make reviews do double duty
  • To promulgate broad recognition, trust
  • To train more people to do reviews

7
Why the NMTA?
  • A public / private entity is necessary
  • Broad industry participation is necessary
  • Peer review is necessary
  • Lowest cost for the masses is necessary
  • No one else will do what needs to be done
  • No one else can do what needs to be done

8
The Review and Rating System is the Key
  • Challenges to be met
  • 1. Get reviews standardized, objectified and
    endorsed by every sector
  • 2. Figure out how many man-hours are reasonable
    for different size and type of organizations
  • 3. Figure out who is going to do it
  • 4. Figure out who is going to pay for it (share
    costs for agents)
  • 5. Start training programs to train reviewers,
    CEOs and COs, familiarize everyone with what the
    review proves and how

1.
9
Result
If you get a passing score, you get a bank
account.Period.
10
Why Colored Logos and Membership Levels?
  • Members undergo certification to the extent they
    choose to and are willing to pay for
  • This provides positive incentive, rather than
    mere condemnation
  • Basic (Green) Membership provides broad inclusion
    with minimum standards
  • Higher levels (Silver and Gold) encourage and
    recognize excellence and allow for distinction

11
General Considerations
  • For licensees, we do not need to certify
  • Identity
  • Corporate existence
  • Background check
  • Personal and business financials, etc..
  • Because states do that.
  • But we could, at the members request.

12
Basic Membership Requirements
Licensed in any US jurisdiction No pending indictments Fills out self-certified form and pays dues No member objections
13
Silver Membership Requirements
Submits assessment and does reasonably well. May be small, but good (manual systems.) No member objections
14
Gold Membership Requirements
Submits assessment and does very well. State-of-the-Art systems No member objections.
15
The Council on Standards and Practices of the
NMTA
16
The Council on Standards and Practices of the
NMTA
  • May get involved at any time in
  • Standards-setting
  • Assessment format / process
  • Framing the debate
  • Commenting on Green members
  • And when called upon to review those applying for
    Silver or Gold rating
  • NMTA retains independent judgment

17
The Council on Standards and Practices of the
NMTA
Provides a check and balance to the NMTA Is an outside, professional organization Has a professional relationship with the NMTA Will evolve into standards body for MT/MSB audits and audit professionals Retains its independent judgment and autonomy Withholds its seal of approval at will Serves pro bono at a basic level Licensee may pay for more work, if desired
18
The Council on Standards and Practices of the
NMTA
  • Avoids one licensee judging another
  • competitors opinion not objective
  • confidential info guarded from competitors
  • Assists the NMTA in complaints, removals
  • Provides independence, objectivity and
    credibility
  • E.D. and staff do most of the legwork

19
THE SEAL OF THE CSP IS GRANTED AT THE DISCRETION
OF THE CSP
20
The NMTA Meta-Assessment
  • To be filled out and signed by the existing
    outside reviewer
  • Leverages the outside review
  • Acts as a check for completeness
  • Adds two more layers of expert opinion, at
    minimal cost

21
Assessment Format Example
  • Licensed Money Transmitter
  • BSA/AML Compliance Program Assessment Report
  • as of ______________ Assessment on (Company
    Name)
  • A BSA/AML review was performed on ________ from
    ______ , ______ to ______ , ______ , which
    included the following major area
  • Major Area TRAINING
  • Frequency
  • Coverage
  • Updated Material
  • Competence of the Trainer
  • Testing
  • Please rate the performance of the company on
    each of the preceding points using the following
    scale
  • 0 No opportunity to observe
  • 1 Unsatisfactory
  • 2 Below Average
  • 3 Average

22
Assessment Scale
0 1 2 3 4 5
No opportunity to observe Un-satisfactory Below Average Average Good Excellent
23
Methodology Scale
1 2 3 4 5
Interview Personnel Review Paperwork Third Party Verification Direct Sample Verification Total Direct Verification
24
Major Area Example
  • Compliance Officer
  • Competency
  • Authority
  • Enough personnel

25
Major Area Example
  • Adequate software
  • OFAC
  • Agent review and control
  • Anti-structuring
  • Overall quality standards
  • Competency of personnel

26
Major Area Example
  • Risk Management
  • Does the licensee put resources and extra effort
    when necessary?
  • (e.g. high risk countries, high risk agents)

27
Major Area Example
  • Board Awareness
  • Governance
  • Policies
  • Documentation

28
Major Area Example
  • Written compliance materials
  • Manual
  • Other written materials
  • Procedures
  • Controls

29
Major Area Example
  • Agent Supervision
  • ID threshold
  • Computer controls
  • Personal visits
  • Surprise/undercover visits
  • Rehabilitation or cancellation?

30
Assessment
  • For each Major Area and sub-category
  • Raw scores
  • Methodology described
  • Narrative comments
  • Weight-adjusted score with comments
  • Bottom Line
  • overall executive summary
  • overall score
  • notes for improvement

31
Some Other Major Areas
  • Escheatment / Gramm-Leach-Bliley
  • OFAC (very important)
  • Non-BSA compliance
  • Legal matters
  • State compliance
  • Disaster recovery
  • IT Audits
  • Due diligence on foreign correspondents

32
Standardized BSA/AML Checklist
  • Example of a potential CSP application
  • This application will help to ensure that you
    have not overlooked a potential subject that may
    be covered in a review.
  • But, just as importantly

33
Standardized BSA/AML Checklist
  • It can help prove to your bank/regulator that
    your AML compliance program is taken seriously
    and is well managed

34
Features
  • Easy QA format based on the BSA and FinCEN
    guidance
  • Ability to assign remediation tasks to
    responsible parties
  • Attach notes to each item allows the user to
    document current and future needs regarding BSA
    implementation and examination status
  • Printable custom reports to show your bank the
    status of your compliance with legislation,
    regulation and guidance
  • Easy to use searchable help file for all
    legislation, regulation and MSB guidance
  • Status graph (histogram) highlights the
    completion of your AML responsibilities
  • Allows you to conduct a self assessment and
    reduce costs associated with independent testing

35
Made available to youthrough NMTA for a limited
time
  • Free download
  • Easy to use, no additional software
  • No special technical requirements
  • Updated regularly
  • http//www.impactAML.com/MSBChecklist.html

36
Silver and Gold RatingApplication Process
  • E.D. accepts application
  • E.D. and staff collect info
  • E.D. presents info to CSP
  • CSP requests more info or proofs
  • CSP renders decision
  • E.D. presents abstracted case to the full Board
    or appointed committee
  • Member may defend his case
  • Board vote is taken on level of certification
  • If approved, color announcement is made, if
    not
  • Licensee may show proof of cure and re-apply

37
Member Objection Process
  • Member with complaint informs E.D. at any time
  • E.D. and staff collect info
  • E.D. presents info to CSP
  • CSP requests more info or proofs, if necessary
  • CSP renders opinion
  • E.D. presents case to the full Board or appointed
    committee
  • Member may defend his case
  • Board vote is taken
  • If sustained, Board decides appropriate action
  • Licensee may usually show proof of cure and
    re-apply

38
END RESULT
With prior permission, reviews may be released to specified parties (banks, etc.)Member receives dated certificates from the NMTA and the CSP. Member may display the following logo combinations next to their name With prior permission, reviews may be released to specified parties (banks, etc.)Member receives dated certificates from the NMTA and the CSP. Member may display the following logo combinations next to their name
(or Agent Logo) (No CSP review)



39
Next Up.
  • International Standardization of the Money
    Transfer Business
  • Requires broad participation from all sectors and
    countries
  • Requires a framework of organization,
    communication, deliberation

40
Thank You!
  • If you are interested in getting involved on the
    Steering Committee of the Council of Standards
    and Practices (CSP), please contact
  • Kenneth L. Bryant
  • Chairman
  • Steering Committee
  • NMTA CSP
  • ken_at_amlcft.com
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