Compliance 2.0 is the “new normal” in big banks

Compliance 2.0 is the “new normal” in big banks

Donna Boehme – Compliance & Ethics Professional – October 2015 

Banks group

In March 2013, the Compliance field took note of the growing embrace of Compliance 2.0 in the big banking industry. As I noted then,

“After a parade of scandals that has seen bank after bank slapped with penalties or rocked with reports of LIBOR rigging, mortgage fraud, money laundering, tax fraud, high-risk “rogue” trading, and a host of other misconduct, prosecutors and regulators are scrutinizing all aspects Boehme of compliance functions—and the financial sector is reacting.”

Whether under pressure from prosecutors, regulators, and investors or reacting on their own accord in the wake of billion dollar fines and settlements for a variety of compliance sins, a growing cadre of big banks have each recognized the fatal flaws of the ages-old Compliance 1.0 model—Compliance as a captive arm of Legal. In its place, they’ve begun to embrace the more powerful, strategically-positioned model of Compliance 2.0, designed to effectively prevent, find, fix, and remedy problems that threaten their organizations.

If one is keeping a list, HSBC, JPMorgan Chase, Goldman Sachs, Barclay’s, UBS, Bank of America, and CitiGroup come to mind. So that’s the big bank industry following the path of Compliance 2.0 blazed by healthcare* and Wal-Mart.

Who’s next?

*Additionally, see the new OIG Guidelines for healthcare.

(PDF Version)

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