Goney-laundering schemes and mule accounts may seem like components of Hollywood's latest heist film, but finance experts know how mutual they really are. Tech-savvy criminals armed with laptops use stolen information to admission or open up accounts, thereby funding their illegal activities. While only the most notorious cases make headlines, the action is near constant. Midsized banks close thousands of suspicious accounts each year in a never-ending quest to detect and report criminal behavior.

Someday a financial institution suspects a example of money laundering or fraud, its employees must file a Suspicious Activity Study (SAR) with the Financial Crimes Enforcement Network. In 2019, banks and credit unions filed 1,116,400 SARs—a xiv.2 percentage increase over the previous year. Categories and options on the SAR class include Ponzi schemes, human trafficking, market place manipulation, mortgage fraud, and transactions involving loftier-run a risk strange jurisdictions.

Matt Mandrell, SVP/Managing Managing director, BSA, AML, OFAC, Fulton Bank, North.A. Photo by Eden Mandrell

Banks and other financial institutions have been required to report transactional activity since 1970. Then, in the mid-1980s, Congress passed the Bank Secrecy Human activity (BSA) in an effort to identify and stop widespread coin laundering. Although the human activity has been in place for decades, the 2001 terrorist acts permanently changed the national outlook. The ix/11 Commission knew it had to address terrorist financing in the United States. The Patriot Act, passed in October 2001, strengthened US efforts to prevent and detect money laundering and terrorist financing.

The act also added new reporting and diligence requirements that brought these issues further into the mainstream. Seemingly overnight, robust anti-money-laundering (AML) and BSA programs became critically important to banks. Institutions that neglect to meet requirements face large fines. HSBC has paid $1.9 billion for noncompliance, and regulators accept levied $613 million in penalties against US Bancorp.

With so much at stake, Fulton Banking concern, North.A. needed a proven expert to build out its AML and BSA programs. Fortunately, Matt Mandrell, who holds an undergraduate degree in criminal justice and a JD from the California Western School of Law, fit the bill. 14 years in-house at BMO Harris had left him well versed in fiscal services as a whole, with specialized knowledge of AML and BSA compliance matters.

Edifice an effective program is challenging, but at Fulton, Mandrell had two important pieces in place—a solid foundation and supportive leaders. "You take to have buy-in from the top, because many people in the organisation have an active role to play," he says. "There has to exist a culture of compliance."

The now senior vice president and managing director of BSA, AML, and OFAC set out to build upon Fulton'due south existing foundation. An constructive programme, he says, is anchored by 3 components: an IT team, a governance office, and a financial intelligence unit. "The pieces of a practiced BSA program are equally of import, but you have to start with good information. If we don't capture clean data, we can't assess information technology for unusual activity, and the whole program fails," Mandrell explains.

It's a high-book affair. Current regulations require financial institutions to monitor fiscal transactions, identify all individuals conducting transactions, report suspicious activity, and flag cash transactions of more than $10,000. Banks like Fulton don't measure transactions by the month, the week, or fifty-fifty by the day—they track transactions per 2d. Fulton processes thousands of transactions every sixty seconds, and each one must be accurately accounted for.

"Someone in my position has to pull together many pieces to build something complex, and so we become to see how it works before finding ways to improve what we've congenital. Information technology's a fun journey."

Afterwards assessing Fulton's needs, Mandrell worked with HR to recruit the right BSA professionals and reduce gaps in data processing. He then turned his focus to governance. In that phase, Mandrell worked to perform run a risk assessments and become training policies and procedures in place. Finally, he congenital out a financial intelligence unit fabricated upward of bankers, former law enforcement officers, and others who review flagged transactions, assess client risk, and file SARs.

With the initial piece of work complete, Fulton'southward AML and BSA program was up and running, only in some ways, the existent piece of work was just getting started. "A Banking concern Secrecy Act Program needs to exist cost-effective and efficient, yet it'due south a relatively new field," Mandrell says. "Growing your team and making continuous improvements tin can have years."

After watching the procedure get through several cycles, Mandrell and his colleagues had a clear agreement of what was working and what wasn't. They identified deficiencies and moved into a remediation stage. Equally money launderers and criminals change their methods, BSA officers have to keep footstep. Mandrell is ever looking for new technologies he can leverage every bit part of Fulton's program. Over the last 9 years, his team has grown from x to fifty employees. Together, they have the bank's AML and BSA program achieving consistent results over multiple exam cycles.

With increased regulatory scrutiny and a certain measure of unpredictability, the job of a BSA architect can be stressful. Mandrell has learned to enjoy information technology. "Someone in my position has to pull together many pieces to build something complex, and then we get to run across how it works before finding means to improve what we've built. It'southward a fun journey," he says.

In some ways, it was an unexpected journey. Mandrell became a BSA compliance officeholder in 2004 for what was supposed to be a two-year stint. And then it became a four-year term. All these years later, he's a respected field of study thing expert in his manufacture. He encourages others to follow in his footsteps. "Be curious, have initiative, and try new things," he says. "You never know where information technology will accept you."

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Crowe LLP:

"Matt, thanks for all you continue to practise to fight financial law-breaking. You are an innovative leader in our industry, and we look forward to hereafter collaboration within Crowe'southward Financial Offense Peer Grouping."

–Tamara Kolb, Troy La Huis, Greg LeMond, Principals

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Guidehouse:

"Nosotros worked with Matt and his team to assist them go their program where it needed to exist. We establish that he was extremely knowledgeable on the issues, but more importantly, understood, appreciated and wanted to do the correct affair for the bank. He showed great leadership in instilling a potent culture of compliance throughout the organization."

–Jay Perlman, Financial Services Director