Moody's: Firms see potential risk from Libor transition planning | Barclays analyst warns of bank vulnerability on credit card risk | Regulators eye reform of stress testing
May 21, 2019
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Internal Audit Watch
FINRA publishes advice on complying with AML rules
The Financial Industry Regulatory Authority has released guidance on what broker-dealers must do to comply with anti-money-laundering requirements. The regulatory notice gives examples of red flags that require financial professionals to file suspicious-activity reports.
ThinkAdvisor (free registration) (5/9) 
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Network With Financial Services Regulators in DC
Register for the event that received rave reviews among financial services auditors. Gain insight into the latest regulatory reform and take advantage of opportunities to network and share leading practices with industry leaders while earning up to 15 CPE credits. Register now.
Risk Management
Moody's: Firms see potential risk from Libor transition planning
Financial firms and institutions expect material risk when the switch to alternative benchmarks from Libor occurs in 2021, according to Moody's Investors Service. "Most banks and large [nonbank financial institutions] are active in working groups with regulators and industry associations, ensuring sharing of information among market participants and consistent integration of standards into contracts," Moody's says.
Investment Executive (Canada) (5/16) 
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Barclays analyst warns of bank vulnerability on credit card risk
A Barclays analyst says US lenders are keeping impaired credit card loans on their books while selling higher-rated loans to investors as asset-backed securities. Barclays says it currently is not alarmed by the practice, although it could leave banks rather than investors exposed to the impact of a downturn.
Bloomberg (tiered subscription model) (5/6) 
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2019 Benchmarking Questionnaire Is Now Open!
The 2019 benchmarking questionnaire is now open. Obtain the data you need to support more effective decision making. Benchmark now.
Regulation & Compliance
Regulators eye reform of stress testing
Regulatory reform in the US is taking aim at bank stress tests. Indiana University professor Matthew Turk outlines the key criticisms of the existing structure, including that the current tests fail to capture systemic risk.
Harvard Law School (5/6) 
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OFAC releases guidance to help banks' sanctions-related compliance
Recent compliance guidelines from the Treasury Department's Office of Foreign Assets Control are meant to help banks create effective sanctions compliance programs. Having a risk-based approach is a key area of focus.
ABA Banking Journal online (5/2) 
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SEC worried about insufficient compliance spending
Financial firms' compliance budgets are being cut at a time when some companies already aren't allocating sufficient resources to compliance, says Pete Driscoll, director of the Securities and Exchange Commission's Office of Compliance Inspections and Examinations. "We cannot underscore enough a firm's continued need to assess whether its compliance program has adequate resources to support its compliance function," he says.
InvestmentNews (tiered subscription model) (5/13) 
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Report tracks progress of global Basel III compliance
Basel Committee on Banking Supervision jurisdictions are catching up on Basel III standards, making progress post-deadline.
Bank for International Settlements (5/7) 
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FSAC Report: Management Metrics & Audit Planning
This supplement to the 2019 North American Pulse of Internal Audit provides insights for CAEs in financial services. FSAC conducted a separate analysis on the responses from financial services participants. This report focuses on internal audit management metrics and audit planning. Read more.
Fraud & Ethics
10 charged in multimillion-dollar 2016 cyberthefts
Ten members of a cybercrime network are charged with stealing millions in the 2016 release of malware that allegedly helped them transfer money out of victims' accounts. The US and five other nations worked together on the investigation -- a level of international cooperation that's vital to combating fraud of this scope, said Craig Newman, a partner at law firm Patterson Belknap Webb & Tyler.
The Hill (5/16),  The Wall Street Journal (tiered subscription model) (5/16) 
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Banking, e-commerce, dating apps biggest fraud targets
Banking, e-commerce and dating apps are the likeliest targets for online fraud, says a report by Adjust, which rejected more than 269 million fraudulent installs last year. Dating was also the app category with the fifth fastest growth, with mid-core games taking the lead.
Mobile Marketing Magazine (5/15) 
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Leverage an External Quality Assessment in 2019
Build confidence with your stakeholders through a solid Quality Assurance and Improvement Program (QAIP). IIA Quality Services, LLC provides the tools, expertise, and services to support your QAIP. Read more.
OCC: Banks struggle to find top compliance talent
US banks are struggling to onboard and retain top compliance professionals who specialize in financial rules, an Office of the Comptroller of the Currency report says. Banks are increasingly looking to artificial intelligence and other technologies to make their compliance departments more efficient, the report says.
The Wall Street Journal (tiered subscription model) (5/20) 
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The New CIA Exam is Here.
Updated, aligned, and focused - the new Certified Internal Auditor® (CIA®) exam has arrived. CIA proves you are a credible internal audit professional and the new, balanced, clear, and uniform exam parts will get you there.
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IIA News
Technology and the internal audit workforce
Cassian Jae is joined by Chris Paulison from Grant Thornton to discuss technology and the internal audit workforce of the future, the impact on the financial services industry and the talent that audit organizations are seeking. Listen in to this AuditCast.
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FSAC membership
The Financial Services Audit Center is the premier resource for auditors in the financial-services industry, delivering low-cost, high-quality knowledge sharing as well as relevant reporting on trends, benchmarking and critical content. Join now.
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About the IIA Financial Services Audit Center (FSAC)
FSAC is an IIA specialty center for audit professionals in the banking, asset management, and insurance sectors. FSAC advances the professional practice of auditing in the financial services industry through thought leadership, education and training events, professional guidance, and advocacy. Learn more about FSAC and how you can add the center to your IIA membership.
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