In recent years, Bank Secrecy Act (BSA) and anti-money laundering (AML) enforcement actions have increasingly concentrated on internal audit, the third line in the classic three-lines model financial institutions use to protect themselves.
Why this matters and how you can respond
Because enforcement historically looked at second-line failures, some institutions downplay the third line, leading to some significant civil penalties. Here are four areas where internal audit deficiencies attract regulatory attention:
Where we go from here
All firms should consider COVID-19’s impact and how examinations will evolve as your employees continue to work remotely. The pandemic has created new opportunities for malicious actors, even as remote work stresses normal compliance controls. Internal auditors must understand these threats and be prepared to address the new risks. Even before the crisis, regulators had been intensifying their focus on remediation related to compliance programs. Now, we expect this scrutiny will intensify.
Global Financial Crimes Leader, PwC US
Financial Crimes Unit Leader, PwC US
Financial Crimes Unit, AML Leader, PwC US