An anti-laundering solution
The Wynyard analytics service will ready SBS to satisfy the requirements of the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act), due to come into effect in New Zealand on 30 June 2013.
This will require businesses or individuals that carry out financial activities to put in place systems which prevent or detect transactions made by criminals trying to launder money or finance terrorism.
Regardless of where a business is headquartered, if it operates within New Zealand it will be required from mid-next year to demonstrate compliance with the Act.
The choice of the Wynyard offering was a logical one, says SBS’s general manager of risk and support, Mark McLean, as Wynyard is a division of Jade Software, which provides SBS’ core banking systems.
“We have a strong positive relationship with Jade,” he says. In fact, the banking systems and the AML software run at the same Jade datacentre.
However, the bank did look at four other vendors of similar software or services, three of them international companies. The systems offered by the latter in particular were over-complicated for a bank of SBS’s size and scope of operations and were proportionately expensive, MacLean says.
SBS Bank has been using the Wynyard system for six months in pilot phase and has advised Wynyard on its features and particularly the usability of its user interface. “We’re looking to move into production phase in the fourth quarter of this year,” Maclean says.
The bank runs the Wynyard rules over all payment data and customer changes, he says.
On the payment side it is looking for abnormal behaviour, such as large cash deposits out of the ordinary for the individual or business concerned, or complex money transfers among several interrelated companies that may indicate laundering.
On the customer side, when a new account is opened, the individuals’ names are checked against a list of suspicious people maintained by financial information company Dow Jones.
Once the Wynyard analytics have identified suspicious activity, the transactions or people concerned are vetted manually by the bank’s AML/CFT team and if suspicions are confirmed, a report is filed with the Police financial intelligence unit.
Partner Starfish Consulting provides SBS Bank with professional advice in the development of anti-money laundering processes and procedures and continues to work closely with Wynyard Group to ensure the detection rules and algorithms deliver on SBS Bank’s compliance needs.
Besides meeting the requirements of the law, MacLean says, the use of analytics to detect suspicious activity provides a service to customers and the larger community by enhancing the bank’s and New Zealand’s reputation as a safe place in which to do business.
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Posted by Mark Heard at 10:46 on November 20, 2012
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