On November 30, 2023, the New York ACAMS Chapter held an event titled From Consent Order to BAU: Prevention, Sustainability, and Best Practices, which was sponsored by Nisos in conjunction with the Gabelli School of Business, The Center for Professional Accounting Practices. The event was moderated by Drew Bach, Esq. (First Vice President, BSA Officer – First National Bank LI) and included the following amazing panelists (pictured from left to right): Patrick Gilman, (Partner – Eversheds Sutherland), Adrienne Lerro, (Partner, Financial Crimes Unit – PWC), Geeta Rajamani, (Managing Director & Head of First Line of Defense Control Office – MUFG), and Dylan Hennessy, (Director – Nisos).
The discussion began with an overview of what a Consent Order represents and how this type of regulatory action generally comes about (e.g., through multiple warnings and non-public actions). Consent Orders generally specify the activity of concern that has been identified and requirements that must be taken to remedy the concerns.
The panel then covered the steps that should be taken by financial institutions when they are under a Consent Order. A critical step is to define very clear exit criteria (with qualitative and quantitative milestones). The criteria should be specific and agreed upon with the regulator at the onset of the Consent Order issuance. When possible, technology should be leveraged to pool together data and eliminate manual steps to allow for more efficient decisions.
When a financial institution comes out of a Consent Order, it should still view itself as “on probation” and should ensure a sustained culture of compliance and cross-functional collaboration, on which regulators will continue to review the institution.
The event ended with a sharing of Consent Order-related success stories, some of which entailed the importance of obtaining buy-in from the first line of defense regarding the importance of investing in Compliance processes and technology.