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Hi *|FNAME|*

Regulators and investors across the globe go Green.

AML and Governance take center stage.

UK issues sustainable finance best practice for asset managers (https://uk.reuters.com/article/uk-britain-funds-sustainability/uk-issues-sustainable-finance-best-practice-for-asset-managers-idUKKBN27D0YP) . The government has, for the first time, issued a set of standards for asset managers engaged in the sustainable investment sector. Whilst perversely London has fallen from its top spot as a global green finance leader, (https://www.cityam.com/london-loses-crown-as-global-green-finance-leader/) after more than two years atop the rankings, reports CityAM. Across the pond, BlackRock called for the creation of a single global sustainability standard (https://www.fnlondon.com/articles/blackrock-wants-global-standard-for-sustainability-reporting-20201029) , claiming existing frameworks are making it difficult to compare companies and leading to confusion for investors.

Warning from the forecourt – Moody’s down-grade ASDA Petrol Stations because of ‘limited progress in financial reporting and governance’ (https://www.msn.com/en-gb/money/other/billionaire-brothers-buying-asda-for-7bn-are-hit-by-credit-rating-setback-as-their-petrol-station-business-is-downgraded-to-junk-territory/ar-BB1aupfd) .

Lack of ‘internal controls’ citied as a reason ETF’s are moving from Europe to US. “several European banks have been hit with large fines for failures in their internal controls” (https://www.ft.com/content/dcf2a95c-c560-4a04-888a-9639acade461) ,

Enjoy

Paul
In the news this week…
AML BILL WILL SWAMP FINANCIAL CRIME TEAMS, BANKS WARN

Proposed US legislation could force firms to run new and old systems in parallel, stretching resources… (https://www.risk.net/risk-management/7699716/aml-bill-will-swamp-financial-crime-teams-banks-warn) read (https://www.risk.net/risk-management/7699716/aml-bill-will-swamp-financial-crime-teams-banks-warn) more (https://www.risk.net/risk-management/7699716/aml-bill-will-swamp-financial-crime-teams-banks-warn)
AML NON-COMPLIANCE – REGULATED FIRM RISK

Those in the banking, lending, wealth management and estate agents sectors are only 55% of the way through their Fifth Money Laundering implementation plans… read more (https://www.financialreporter.co.uk/regulation/ajority-of-regulated-firms-risk-fines-for-non-compliance-with-new-money-laundering-rules.html)
SOLO REGULATED FIRMS: 16-WEEK EXTENSION FOR SM&CR

Firms will now have until 31 March to implement the requirements which apply to all staff and include submitting details to the FCA register… read more (https://www.footanstey.com/article/extension-of-the-smcr-implementation-periods-for-solo-regulated-firms/#:~:text=The%20FCA%20has%20confirmed%20that,to%20carry%20out%20this%20process.)
FCA WARNS BROKERS ON SERVICE ‘WITHOUT EXPERIENCE’

The financial regulator is expected to begin probing advice given on second charge and lifetime mortgages next year amid concerns… read more (https://www.ftadviser.com/regulation/2020/10/30/fca-warns-brokers-on-providing-services-without-experience/)
GOVERNANCE RISK FOR BANKS – DRAWING ON EXPERIENCE AND EXTERNAL EXPERTISE

Rating relevance of non-financial risk failures in managing non-financial risks such as governance and financial crime risks often result in fines, penalties and remediation costs… read more (https://www.fitchratings.com/research/banks/governance-risk-for-banks-drawing-on-experience-external-expertise-to-assess-financial-crime-risk-29-10-2020)
THE IMPORTANCE OF RISK & GOVERNANCE IN RESPONSE TO SHORT-SELLER ATTACK.
Grenke’s franchise model has been in focus following a report that accused Grenke of fraud. Grenke denies the allegations, said it planned to integrate its 16 franchises and appoint CRO… read more (https://uk.reuters.com/article/idUKL8N2HK1OL)
IT AUDIT – RESEARCH SHOWS MOST COMPANIES HAVE HIGH-RISK NETWORK PERIMETER VULNERABILITIES

84% of companies across finance, manufacturing, IT, retail, government, telecoms and advertising have one or more hosts with a high-risk vulnerability having a publicly available exploit… read more (https://www.helpnetsecurity.com/2020/10/29/network-perimeter-vulnerabilities/)
FCA ISSUE FINAL NOTICE TO CEO FOR MARKET MANIPULATION

FCA has published a final notice issued to the former CEO of Worldspreads Group plc, for section 118(5) (manipulating transactions), (6) (manipulating devices) and (7) (dissemination) of the Financial Services and Markets Act 2000 FSMA… read more (https://www.mondaq.com/uk/financial-services/999340/fca-issue-final-notice-to-ceo-for-market-manipulation)

** Hiring for your Internal Audit team?
————————————————————
We have an extensive network of immediately available Internal Audit candidates. Call Paul on 0203 397 1774
Paul Stanbridge
Before establishing Fleet Search and Selection with Craig Phipps, Paul worked as an Equity Research Analyst in London. Now, a recruitment consultant for almost two decades, he has recruited many senior roles, including Global Heads of Audit and C-Suite executives. His wide network spans Insurance, Asset Management and Banking, with expertise including Audit, Compliance and Advisory.
As with his day job, Paul likes getting people excited about things. He is a passionate competitive foil fencer with 5 caps for Scotland and now enjoys coaching others to enjoy fencing too.
Contact:
[email protected] (mailto:[email protected])
Craig Phipps

Craig has spent over 20 years recruiting for the Financial Services Industry, predominately in Business and Technology Audit for Investment Banks and Asset Managers. He has also recruited extensively in Market Risk and Quantitative finance. Prior to establishing Fleet Search and Selection, he headed up the Investment Banking Audit and IT Audit Divisions at two prominent recruitment companies.
Craig has helped 100’s of candidates make difficult career choices. When not at work, his strategic mindset turns to his passions for skiing and rugby and is a huge supporter of Australia’s national rugby team.
Contact:
[email protected] (mailto:[email protected])

============================================================
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Hi *|FNAME|*

News this week on both sides of the Atlantic was dominated by External Audit regulatory reforms and Money Laundering.

The big news, however, came as Goldmans join Danske in the ‘$2B fine club’ [Danske Estonian branch’s fines were covered in last week’s email blog (https://us13.campaign-archive.com/?u=13d589a9257a929df14b13550&id=197f90c2c3) ]. Goldman’s Asia has been fined a record $350M by Hong Kong for their part in 1MDDB. They start the global regulator’s punishment pf Goldmans (soon joined by U, UK and SIngaporean regulators) in what amount to a total of $2 Billion of fines for Goldman’s role in looting billions of dollars destined for the economic development of Malaysia which were siphoned off in a money laundering and corruption scandal. The LondonFN additionally reported that clawbacks from top Goldmans execs totaling $174M (https://www.fnlondon.com/articles/goldman-claws-back-millions-from-top-execs-to-pay-1mdb-scandal-fines-20201023) will be used to help pay these fines.

The Big 4 had it tough as well this week… The FRC commented, “Concerns have been raised that auditors are not doing enough”. It proposes changes that put the onus directly on Auditors to look for wrongdoing. [story below]. I guess we have Wirecard to thank for accelerating these discussions…

Despite Audit income rising sharply last year, there was a 20% drop in fees from non-audit work for audit clients. (https://www.accountancydaily.co/big-fours-non-audit-fees-clients-fall-20)

Deloitte announced that they will be shutting four UK offices (https://uk.reuters.com/article/uk-britain-deloitte-idUKKBN2720HE) https://www.accountancydaily.co/big-fours-non-audit-fees-clients-fall-20as it reviews its real estate portfolio in the coronavirus pandemic. Staff will be retained on work-from-home contracts. Expect to see many more work-from-home contracts in the months to come!

Compliance leads gender equality: Women work in compliance, men work in trading (https://news.efinancialcareers.com/uk-en/3004663/women-in-compliance-men-in-trading) so say efinancial in their interview with two former heads of EMEA compliance at a U.S. investment bank – …”If you look at the compliance function… women are typically far more populous.”

And lastly … the FRC, is to ‘beef up standards (https://www.accountancydaily.co/frc-beef-standard-fraud-detection) ‘ on 16-year old regulations amid fears they are not sufficiently clear [story below]. Reforms have been overdue for many years [ibid 2018 Sir John Kingsman review (https://www.icaew.com/-/media/corporate/files/technical/icaew-representations/2018/icaew-rep-92-18-review-of-the-financial-reporting-council-by-sir-john-kingman.ashx ) ]…now I’m not saying it’s an easy job but the FRC isn’t without other delays… I’ll leave this here….. https://news.sky.com/story/governance-watchdog-faces- embarrassment-over-chairman-delay-12086712 (https://news.sky.com/story/governance-watchdog-faces- embarrassment-over-chairman-delay-12086712)

That’s all for this week.

Enjoy

Paul
In the news this week…
ASSET MANAGERS COMMITTED INSIDER TRADING, AUDIT DISCOVERS

Forensic audit of key Franklin Templeton India personnel concludes insider trading and issues £900k fine … read (https://www.livemint.com/mutual-fund/mf-news/franklin-templeton-some-officials-redeemed-investments-before-winding-up-shows-forensic-audit-11601996044374.html) more (https://www.livemint.com/mutual-fund/mf-news/franklin-templeton-some-officials-redeemed-investments-before-winding-up-shows-forensic-audit-11601996044374.html)

PANDEMIC’S IMPACT ON RISK-BASED CAPITAL (RBC)

Insights into how the current environment has impacted capital levels and how rating agencies may view a company’s ability to withstand market volatility… read more (https://www.guycarp.com/insights/risk-based-capital-stress-testing.html)
STRENGTHENING SUPERVISORY CO-OPERATION IN DERIVATIVES MARKETS

Commodity Futures Trading Commission and Bank of England sign new agreement on supervisory co-operation in derivatives markets .. read more (https://www.risk.net/regulation/7699926/strengthening-supervisory-co-operation-in-derivatives-markets)

IRELAND FIRES WARNING SHOT TO ASSET MANAGERS ON DELEGATION

Central Bank of Ireland warns asset managers to correct “significant shortcomings” in the governance of Irish entities; viability of the delegation model put in question … read more (https://uk.advfn.com/stock-market/stock-news/83505128/convergence-announces-its-expansion-into-the-irish)
HONG KONG FINES GOLDMAN ASIA RECORD $350M OVER 1MDB

HK lead the US,UK and Singapore regulators punishing Goldman for their role in 1MDB looting billions of dollars in Malaysian money laundering scandal… read more (https://www.scmp.com/business/banking-finance/article/3106660/hong-kong-slaps-record-fine-us350-million-goldman-sachs)
U.K. REGULATOR PUSHES AUDITORS TO SNIFF OUT FRAUD

Financial Reporting Council proposes rule changes amidst concerns that auditors aren’t doing enough … read more (https://www.wsj.com/articles/u-k-regulator-pushes-auditors-to-sniff-out-fraud-11603290771#:~:text=The%20U.K.’s%20accounting%20regulator,to%20auditing%20rules%20on%20Tuesday.)

SEC APPROVES CHANGES TO EASE AUDITOR-INDEPENDENCE RULES FOR COMPANIES, AUDIT FIRMS

Changes will make it easier for companies and audit firms to avoid violations, especially involving IPOs and lending relationships… read more (https://www.wsj.com/articles/sec-approves-changes-to-ease-auditor-independence-rules-for-companies-audit-firms-11602868427)
EU SETS SIGHTS ON MONEY MARKET FUND REFORM

European regulators call for reforms of the continent’s €1.4tn money market fund sector after it came close to buckling under the coronavirus-induced market stress in March … read more (http://www.finregalert.com/eu-sets-sights-on-money-market-fund-reform/)

** Hiring for your Internal Audit team?
————————————————————
We have an extensive network of immediately available Internal Audit candidates. Call Paul on 0203 397 1774
Paul Stanbridge
Before establishing Fleet Search and Selection with Craig Phipps, Paul worked as an Equity Research Analyst in London. Now, a recruitment consultant for almost two decades, he has recruited many senior roles, including Global Heads of Audit and C-Suite executives. His wide network spans Insurance, Asset Management and Banking, with expertise including Audit, Compliance and Advisory.
As with his day job, Paul likes getting people excited about things. He is a passionate competitive foil fencer with 5 caps for Scotland and now enjoys coaching others to enjoy fencing too.
Contact:
[email protected] (mailto:[email protected])
Craig Phipps

Craig has spent over 20 years recruiting for the Financial Services Industry, predominately in Business and Technology Audit for Investment Banks and Asset Managers. He has also recruited extensively in Market Risk and Quantitative finance. Prior to establishing Fleet Search and Selection, he headed up the Investment Banking Audit and IT Audit Divisions at two prominent recruitment companies.
Craig has helped 100’s of candidates make difficult career choices. When not at work, his strategic mindset turns to his passions for skiing and rugby and is a huge supporter of Australia’s national rugby team.
Contact:
[email protected] (mailto:[email protected])

============================================================
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Hi *|FNAME|*

Last week I received an email to ask for clarity on the huge increase in one of the hottest topics right now – decentralised finance. There’s an excellent comprehensive introduction to the topic of DeFi from Gavin Brown Associate Professor in FinTech (https://www.icaew.com/insights/viewpoints-on-the-news/2020/oct-2020/what-is-defi-and-why-does-it-matter-for-accountants) , CA on the ICAEW website this week.

MS Excel was a top story on the BBC website this week. If, like me you were fastidiously following the UK Excel file / covid bungle, I recommend this site dedicated to recording spreadsheet risk (http://www.eusprig.org/horror-stories.htm) . Full of fascinating [no, they really are!] spreadsheet horror stories…

“Scientists rename human genes to stop Microsoft Excel from misreading them as dates”…. “Drinks company’s £5.2M spreadsheet arithmetic error”.

Danske Bank AML update – Danske is due to finish its own investigation into the internal governance mistakes that allowed €200 billion+ of dirty money to flow through the Estonian subsidiary from 2007- 2015 (https://uk.reuters.com/article/us-danske-bank-moneylaundering-explainer/explainer-danske-banks-200-billion-euro-money-laundering-scandal-idUKKCN1NO10D) . For those interested, Compliance Week will be hosting a webinar (ticketed) withDanske Banks new Chief Compliance officer, Philippe Vollot in November. (https://events.complianceweek.com/event/2b0a2c22-8c3e-4682-b44c-2e849f97e2f2/websitePage:a8d1b404-6ba9-4215-b995-13ee6a0a7937?rt=yVO0CzbuzEeLFG80Jo5GRA&utm_campaign=cwe2020v&utm_medium=email&mkt_tok=eyJpIjoiT1RCaVpqRTBaVFU1TkRRMCIsInQiOiJuNkRDTGJTUUo0d0wyRitsZWlSTUxUd1k3OEpUOVhlT1RKTDM3REwyR3NmUVpxSzExZmhsdjBGZ200S2tWeEE2VklYeXgxeXpHRmtsbEc5SXZBS1VGRVQ0K3dVMWdyV2I5UStleTBDSkdzV2h6YnFXbWRac1dIZGhqY2d1Y2VYVSJ9&RefId=em05-agenda-link&utm_content=cta_agenda&utm_source=em05-mmbr-rg-1)
Deutsche Bank were also being investigated as a result of the Danske Bank probe but German prosecutors have now dropped their Money Laundering investigation into senior management misconduct… however on their way out, they did leave the German bank with a $16M fine… story below.

That’s all for this week.

Enjoy

Paul
In the news this week…
DEUTSCHE BANK FINED $16M BY GERMAN PROSECUTORS IN DANSKE PROBE

Deutsche Bank AG fined 13.5 million euros ($16 million) by Frankfurt prosecutors over money-laundering violations related to work with Danske Bank… read more (https://www.bloombergquint.com/markets/deutsche-bank-fined-by-german-prosecutors-in-danske-bank-probe)
HEDGE FUND FINED FOR NOT DISCLOSING SHORT POSITIONS

A Hong Kong-based hedge fund has been fined almost £900,000 after failing to disclose its record-breaking short position in Premier Oil… read more (https://www.thetimes.co.uk/article/hedge-fund-fined-for-not-disclosing-premier-short-ng83f9zs5#:~:text=A%20Hong%20Kong%2Dbased%20hedge,short%20position%20in%20Premier%20Oil.&text=The%20fund%2C%20which%20declined%20to,Capital%2C%20an%20American%20hedge%20fund.)
AUDITOR DEATHS – LIBERIA REQUESTS US INTERVENTION AFTER STRING OF DEATHS

President George Weah of Liberia is seeking the assistance of the United States administration to probe the mysterious deaths of at least three government workers in eight days… read more (https://uk.news.yahoo.com/liberia-requests-us-intervention-string-185402926.html)
LLOYDS BANK – INTERNAL AUDIT REDUNDANCIES EXPECTED

According to Accord, one of its staff unions, the groups internal audit team and retail chief operating office are likely to be effected with redundancies… read more (https://www.euroweeklynews.com/2020/10/15/lloyds-banking-group-have-announced-more-job-cuts/)
FCA TURNS THE SCREWS ON COMPLIANCE WHEN WORKING FROM HOME

FCA warns banks they must provide the same standard of surveillance for those working from home amid coronavirus crisis as they would in an office environment… read more (https://www.finextra.com/newsarticle/36734/fca-turns-the-screws-on-compliance-in-work-from-home-environment)
FCA – TWO IFAS BANNED FOR LYING ABOUT HIGH NET WORTH CLIENTS
The City watchdog has banned two advisers who lied about the high net worth status of numerous clients to Sipp provider James Hay…
read more (https://www.ftadviser.com/regulation/2020/10/12/fca-bans-ifas-who-lied-about-high-net-worth-clients/)
ISA600 – CHANGE ON THE HORIZON FOR GROUP AUDITS

As IAASB’s consultation on standards concludes, the ICAEW expects a revised standard which will require auditors to take a more top-down, risk-based approach to the audit of groups… read more (https://www.icaew.com/insights/viewpoints-on-the-news/2020/oct-2020/change-on-the-horizon-for-group-audits)
EXTERNAL AUDIT – GUIDE FOR AUDITORS ON REPORTING IRREGULARITIES INCLUDING FRAUD

Audit reports covering periods post December 2019 must explain extent to which the audit was considered capable of detecting irregularities… read more (https://www.icaew.com/insights/viewpoints-on-the-news/2020/oct-2020/change-on-the-horizon-for-group-audits)

** Hiring for your Internal Audit team?
————————————————————
We have an extensive network of immediately available Internal Audit candidates. Call Paul on 0203 397 1774
Paul Stanbridge
Before establishing Fleet Search and Selection with Craig Phipps, Paul worked as an Equity Research Analyst in London. Now, a recruitment consultant for almost two decades, he has recruited many senior roles, including Global Heads of Audit and C-Suite executives. His wide network spans Insurance, Asset Management and Banking, with expertise including Audit, Compliance and Advisory.
As with his day job, Paul likes getting people excited about things. He is a passionate competitive foil fencer with 5 caps for Scotland and now enjoys coaching others to enjoy fencing too.
Contact:
[email protected] (mailto:[email protected])
Craig Phipps

Craig has spent over 20 years recruiting for the Financial Services Industry, predominately in Business and Technology Audit for Investment Banks and Asset Managers. He has also recruited extensively in Market Risk and Quantitative finance. Prior to establishing Fleet Search and Selection, he headed up the Investment Banking Audit and IT Audit Divisions at two prominent recruitment companies.
Craig has helped 100’s of candidates make difficult career choices. When not at work, his strategic mindset turns to his passions for skiing and rugby and is a huge supporter of Australia’s national rugby team.
Contact:
[email protected] (mailto:[email protected])

============================================================
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Hi *|FNAME|*

AML and Fraud dominate the news [again] with more fines and C&D orders in the U.S.

Citigroup has had its fair share of regulatory admonishment in the last few months, with a $400M fine and a cease and desist order for failing to correct deficiencies in Enterprise Risk Management, Compliance Risk Management, Data Governance, and Internal Controls (story below). Regular readers will remember on 20th Aug I reported that Citi made one of Wall Street’s largest errors, mistakenly transferring $900M. The bank are now in the midst of running multiple lawsuits to recover funds sent in error to lenders of cosmetics company Revlon. Citi says defective software dating from the 1990’s was the cause of the $900M wire transfer. Citi’s woes continue as they contend with a fine of $4.5M by the CFTC for deleting millions of audio files.

In other news, the EU are pushing to ‘lock out London’. It should be no surprise if you read last weeks email that the EU Bloc’s new commissioner has reiterated the EU’s position on moving away from dependence on the UK for access to FS Markets (see below).

And lastly… It wouldn’t be news without mentioning Wirecard -Germany pushes forward with DAX reforms. (https://medtech.news/deutsche-borse-pushes-for-dax-overhaul-after-wirecard-debacle/) ..The overhaul comes as a result of the German regulators search for a way to prevent a repeat of the supervisory failures that allowed Wirecard to construct the €1.9bn gap in it’s accounts before it later became insolvent.

That’s all for this week.

Enjoy

Paul
In the news this week…
CITI – RISK MANAGEMENT & CONTROLS FINE

OCC fines Citigroup $400M plus cease and desist order for failing to correct deficiencies in enterprise-wide risk management, compliance risk management, data governance, and internal controls… read more (https://www.finextra.com/newsarticle/36713/regulators-lose-patience-with-citi-over-risk-management-flaws)
FINCEN

In the leaked files, the intelligence division of FinCEN called the UK a “higher risk jurisdiction”, and compared the country to Cyprus because of the number of UK registered companies that appear in SARs… read more (https://www.bbc.co.uk/news/uk-54226107)
BAE – BANKS UNABLE TO MANAGE AML RISK

BAE cyber arm reports that Banks are unable to keep up with the 22 crimes defined by the EU’s 6th AMLD notably human trafficking. BAE found 36.p.c. of FS professionals aren’t confident in spotting signs of human trafficking… read more (https://www.baesystems.com/en-financialservices/insights/the-global-state-of-anti-money-laundering)
LSE – NEW PLANS TO BLOCK SUSPECT COMPANIES

MPs fear stock exchange is vulnerable to foreign powers – Consultation taking place now… read more (https://www.cityam.com/rishi-sunak-mulls-plans-to-block-suspect-companies-listing-on-stock-exchange/)

BREXIT – EU SAYS THE CITY CAN EXPECT ‘LESS FLUID’ TRADING FROM JANUARY

Bloc’s new finance commissioner reiterates EU’s position that banks and financial services should move away from reliance on London… read more (https://www.cityam.com/eu-says-the-city-can-expect-less-fluid-trading-from-january/)
FCA – IS YOUR FIRM USING THE FCA LOGO?
Advisers have been warned not to use the Financial Conduct Authority’s logo on their website or marketing amid concern some are breaking the regulator’s rules…
read more (https://www.ftadviser.com/regulation/2020/10/07/advisers-warned-over-using-fca-logo/)
FRAUD – FOREX AGENTS BANNED FOR MISUSING £8M OF CLIENT CASH

Two foreign exchange agents banned for total of 24 years after securing more than £9 million from clients only to use the funds to payback previous clients… read more (https://www.gov.uk/government/news/forex-agents-banned-after-misappropriating-9-million)
CRYPTO – UK WATCHDOG BANS BITCOIN-BASED PRODUCTS

Britain’s financial watchdog said on Tuesday it will ban the sale to retail investors of products that track the price of crypto assets like Bitcoin, saying most people lose money on them… read (https://uk.investing.com/news/stock-market-news/uk-watchdog-bans-bitcoinbased-products-for-retail-investors-2227190) more (https://uk.investing.com/news/stock-market-news/uk-watchdog-bans-bitcoinbased-products-for-retail-investors-2227190)

** Hiring for your Internal Audit team?
————————————————————
We have an extensive network of immediately available Internal Audit candidates. Call Paul on 0203 397 1774
Paul Stanbridge
Before establishing Fleet Search and Selection with Craig Phipps, Paul worked as an Equity Research Analyst in London. Now, a recruitment consultant for almost two decades, he has recruited many senior roles, including Global Heads of Audit and C-Suite executives. His wide network spans Insurance, Asset Management and Banking, with expertise including Audit, Compliance and Advisory.
As with his day job, Paul likes getting people excited about things. He is a passionate competitive foil fencer with 5 caps for Scotland and now enjoys coaching others to enjoy fencing too.
Contact:
[email protected] (mailto:[email protected])
Craig Phipps

Craig has spent over 20 years recruiting for the Financial Services Industry, predominately in Business and Technology Audit for Investment Banks and Asset Managers. He has also recruited extensively in Market Risk and Quantitative finance. Prior to establishing Fleet Search and Selection, he headed up the Investment Banking Audit and IT Audit Divisions at two prominent recruitment companies.
Craig has helped 100’s of candidates make difficult career choices. When not at work, his strategic mindset turns to his passions for skiing and rugby and is a huge supporter of Australia’s national rugby team.
Contact:
[email protected] (mailto:[email protected])

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Hi *|FNAME|*

AML and Fraud dominate the news this week, with record fines in the U.S. and long term criminal activity haunting the markets.

First a few updates…

FCA – Appointed Representatives Concerns:
The FCA has highlighted concerns with the way networks are overseeing their appointed representative (AR) firms (https://www.mortgagesolutions.co.uk/news/2020/09/30/fca-warns-about-network-oversight-of-ars-across-financial-services/) across the financial advice industry and it could have implications to other FS sectors..

Crypto regulation:
As Britain’s youngest Crypto founder was charged with AML this week (see below), Bloomberg reported that the booming world of decentralized finance has collected more than $11 billion in cryptocurrencies (https://www.bloomberg.com/news/articles/2020-10-01/booming-crypto-market-a-potential-haven-for-money-laundering) in a matter of months (https://www.bloomberg.com/news/articles/2020-10-01/booming-crypto-market-a-potential-haven-for-money-laundering) and is a potential haven for money laundering, according to new research.

Big 4 Audit Partners Pay:
Deloitte partners’ pay to fall 17% (https://www.ft.com/content/c72c35c8-67a0-4845-8d8d-cddddb37db8a) despite revenue boost reports the FT. Although it shouldn’t hurt too much as last year the Guardian reported Deloitte UK partners (https://www.theguardian.com/business/2019/aug/27/deloitte-uk-partners-in-line-for-biggest-payday-in-10-years-accounting) were in line for biggest payday in 10 years with many handed more than £1m….

Wirecard Update:
WC fraud was flagged by EY staff four years before it fell according to an investigation by theFinancial Times (https://citywire.co.uk/wealth-manager/news/wirecard-fraud-was-flagged-by-ey-staff-four-years-before-it-fell/a1406925) . A probe by fellow auditor KPMG has found that an internal whistle-blower at EY flagged potentially fraudulent practices at the business back in 2016, as well as an alleged attempt to bribe an auditor in India.

And lastly….
Rhymes to prevent Crimes. Poems are the latest weapon (https://www.dailyrecord.co.uk/lifestyle/money/santander-reports-75-investment-fraud-22765279) in the fightback against bank fraud at Santander.

Enjoy this weeks edited news below.

Many thanks

Paul
In the news this week…
US – JPMORGAN TO PAY $920M IN LARGEST EVER SPOOFING SETTLEMENT

Regulators deliver blunt warning to banks to clamp down on high-speed financial market manipulation or risk blockbuster fines and criminal convictions for staff … read more (https://theunionjournal.com/us-regulators-step-up-battle-with-spoofing/)
US – US CHARGES BITCOIN EXCHANGE FOUNDERS OVER MONEY LAUNDERING

Charges are the latest in a years long effort by the US to crackdown on cryptocurrency market that was once largely unregulated… read more (https://www.telegraph.co.uk/news/2020/10/01/britains-youngest-billionaire-bitcoin-exchange-co-founder-charged/)
ELECTRONIC TRADING – US SEC PROPOSES NEW RULES TO ALLEVIATE RISK TO FIXED-INCOME MARKET

The new rules for US Treasuries, corporate debt and municipal securities, are aimed at improving transparency and ops preparedness … read more (https://uk.reuters.com/article/idUKKBN26J2WK)
RISK – UNSETTLING TIMES: WHY IS SETTLEMENT RISK ON THE RISE?

Regulators and market participants searching for answers after BIS figures show substantial increase .. read more (https://www.risk.net/risk-management/7690991/unsettling-times-why-is-settlement-risk-on-the-rise)

UK FRAUD – SFO CHARGES 5 WITH FRAUD AT STEEL TRADER BALLI

UK: Serious Fraud Office take five to court over allegations of fraud relating to collapse of Balli, the Anglo-Iranian steel trader … read more (https://www.ft.com/content/b91965f9-6507-4b15-8927-3bdcbaf10226)

HSBC AML – HSBC’S SHARES DIVE TO LOWEST LEVEL SINCE 1995 AMIDST MONEY LAUNDERING CLAIMS

Leaked files show bank allowed fraudsters to transfer millions of dollars around the world even after it had learned of their scam… read more (https://www.bbc.co.uk/news/business-54230733)
PRIVATE BANKING – FIVE GROUPS OUSTED FROM UN-BACKED RESPONSIBLE INVESTMENT LIST

Five investors removed from the United Nations backed Principles for Responsible Investment, including private banking arm of France’s La Banque Postale… read more (https://www.reuters.com/article/us-global-investments-pri-exclusive-idUSKBN26J0T9)
JERSEY FIN CRIME – ‘SIGNIFICANT’ THREAT OF OVERSEAS FINANCIAL CRIME IN JERSEY

The National Risk Assessment of Money Laundering is the first study of its kind and has been made public by the Government of Jersey…. read (https://www.bbc.co.uk/news/world-europe-jersey-54353356) more (https://www.bbc.co.uk/news/world-europe-jersey-54353356)
SPAIN FRAUD – SPAIN BANKIA TRIAL: THIRTY-FOUR CLEARED OF BANK PRIVATISATION FRAUD

Former head of Spain’s Bankia bank, Rodrigo Rato, and 33 other defendants acquitted of defrauding investors and false accounting… read more (https://www.bbc.co.uk/news/world-europe-54338784)
EU – CAPITAL MARKETS UNION: COMMISSION TO BOOST EUROPE’S CAPITAL MARKETS

The European Commission published ambitious Action Plan to boost the the Capital Markets Union over the coming years…. read more (https://ec.europa.eu/commission/presscorner/detail/en/IP_20_1677)

** Hiring for your Internal Audit team?
————————————————————
We have an extensive network of immediately available Internal Audit candidates. Call Paul on 0203 397 1774
Paul Stanbridge
Before establishing Fleet Search and Selection with Craig Phipps, Paul worked as an Equity Research Analyst in London. Now, a recruitment consultant for almost two decades, he has recruited many senior roles, including Global Heads of Audit and C-Suite executives. His wide network spans Insurance, Asset Management and Banking, with expertise including Audit, Compliance and Advisory.
As with his day job, Paul likes getting people excited about things. He is a passionate competitive foil fencer with 5 caps for Scotland and now enjoys coaching others to enjoy fencing too.
Contact:
[email protected] (mailto:[email protected])
Craig Phipps

Craig has spent over 20 years recruiting for the Financial Services Industry, predominately in Business and Technology Audit for Investment Banks and Asset Managers. He has also recruited extensively in Market Risk and Quantitative finance. Prior to establishing Fleet Search and Selection, he headed up the Investment Banking Audit and IT Audit Divisions at two prominent recruitment companies.
Craig has helped 100’s of candidates make difficult career choices. When not at work, his strategic mindset turns to his passions for skiing and rugby and is a huge supporter of Australia’s national rugby team.
Contact:
[email protected] (mailto:[email protected])

============================================================
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Copyright © 2020 Fleet Search + Selection, All rights reserved.
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35 New Broad Street
London, EC2M 1NH
United Kingdom
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