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Regulators are cracking down on third-party relationship risk. Some vendors say they've got this covered, others say its changing their business.
May 27 -
Bankers and consultants report that the technology challenges of dealing with regulators' stress tests are greater than they first appeared.
May 21 -
The Federal Deposit Insurance Corp.'s first-quarter report on bank earnings said the ratio of loan-loss reserves to noncurrent loans rose for the sixth straight quarter, but some doubt the reserve "coverage ratio" is rebounding fast enough.
June 5 -
We can talk all we want about policies, process and technology, but in the end, financial services remains a people-based business. Having the right people in key risk management roles will yield the strong institutions of tomorrow.
November 21
Protiviti in Menlo Park, Calif. has developed a new module companies can use to develop and manage an anti-corruption program that aids compliance with the U.S. Foreign Corrupt Practices Act and other anti-corruption laws.
The new Governance Portal for Third-Party Anti-Corruption v4.1 operates on Protiviti's governance, risk and compliance platform. It allows users to support multiple activities, including "to identify and respond to a wide array of corruption and reputational risks," the global consulting firm said in a press release Wednesday.
The software is designed to help large organizations create a consistent process for evaluating and managing the risks associated with agents and third-party business partners scattered around the world, said Scott Wisniewski, managing director of Protiviti's Risk Technologies group, in a press release. It also helps them to develop a standardized risk-scoring methodology.
The portal enables companies to create a centralized repository for all program data and activity; gather feedback through questionnaires; identify third parties with heightened risk; and maintain a complete audit trail of activities and create watch lists.
The most common source of FCPA violations comes from third parties acting on behalf of large companies, said Scott Moritz, a former Federal Bureau of Investigation special agent who serves as managing director and global lead of Protiviti's Investigations and Fraud Risk Management practice. "To fully operationalize an anti-corruption program, organizations must have the technology and content to manage the underlying processes and align them with their internal controls and audit programs."
"A Resource Guide to the Foreign Corrupt Practices Act" released in November 2012 by the Criminal Division of the U.S. Department of Justice and the U.S. Securities and Exchange Commission outlines 10 "Hallmarks of an Effective Compliance Program," for third-party due diligence and payments. The guide also indicates that third parties, "including agents, consultants, and distributors, are commonly used to conceal the payment of bribes to foreign officials in international business transactions," which is why the DOJ and SEC assess the effectiveness of a company's third-party risk due diligence and compliance program.
