Fundamentals of Compliance and Compliance Governance Model

Learn how boards and staff build a strong compliance culture, identify laws, and implement policies like anti-money laundering and know your customer, supported by reviews and audits to close gaps.

Explore internal and external sources of compliance, including laws, regulations, standards, rules, and policies, and learn how regulators, audits, and databases drive governance.

Illustrates how an internet-based company serving cross-border clients identifies and complies with applicable laws—foreign exchange, AML, data protection, privacy, cybersecurity, consumer protection—and regulators’ standards.

Identify compliance sources, including laws and internal policies; extract requirements, translate them into board-approved policies and procedures, and implement them for employees to follow, enabling regulatory compliance.

Explore external laws, regulations, and standards alongside internal policies, including taxation, AML CFT, data protection, cybersecurity, environment, and financial reporting and auditing standards.

Explore internal versus external compliance sources by distinguishing law enforcement notices, regulator regulations, and internal company policies in a practical quiz on compliance sources.

Explore how a strong compliance culture starts at the board and cascades through management to staff, emphasizes leadership, integrity, ethical standards, and awareness of policies and regulations.

Identify indicators of strong compliance culture, including a competent, honest board and senior management, zero tolerance, and policies, and contrast with weak culture marked by non-compliance, AML/CFT failures, and penalties.

A weak compliance culture triggers multi-million penalties, public scrutiny, and reputational damage, resulting in loss of customers, vendors, depositors, and liquidity, undermining shareholder and stakeholders' confidence.

Explore indicators of weak compliance culture through a true/false quiz, distinguishing careless board attitudes and frequent regulator inquiries from competent management and high penalties for non-compliance.

Explore how independent regulatory authorities supervise licensing, laws, and on-site inspections, with examples from sec, central banks, fincen, fintrac, fca, and the monetary authority of singapore.

Explore PCI DSS, HIPAA, ISO 27,001, AML regulations and GDPR, SOX, IFRS, and related risk management guidance to understand compliance governance across financial and data privacy landscapes.

Explore sector-specific laws across finance, health and safety, tech and IoT, manufacturing, and services, including e-commerce rules on digital privacy, GDPR, cybersecurity, electronic payments, and foreign exchange.

Explore the three lines of defense in a compliance governance model, from board and senior management to first, second, and third lines, with compliance and internal audit ensuring regulatory adherence.

The board of directors oversees compliance governance with an independent compliance management committee. A dedicated compliance function led by the chief compliance officer supports daily regulatory compliance.

The compliance management committee oversees breaches and compliance issues within the compliance governance model, ensuring new laws, regulator penalties, and procedures are addressed with policies, controls, and mitigation plans.

Detail the typical composition of the compliance management committee, chaired by the CEO with the chief compliance officer as secretary who consolidates issues, penalties, new laws and regulations for discussion.

Explore how the compliance function supports an organization's governance model by identifying laws, drafting policies, and ensuring procedures align with regulatory requirements across factors like size, geography, and product complexity.

The chief compliance officer ensures the compliance function remains independent and has access to necessary information from other departments, enabling aml cft oversight and adherence to laws to prevent penalties.

The compliance function communicates with departments to ensure regulatory alignment, issuing notices, memos, and training. It identifies issues during product development or account processes and advises teams to address non-compliances.

The chief compliance officer leads a risk-based compliance program with board approval, implementing policies on aml cft, anti-corruption, privacy, and ensuring monitoring, reporting, documentation, and training.

Identify the physical and technological resources a compliance function needs, including AML and legal systems, adequate staff, and unrestricted access to records and communications for effective monitoring.

Develop a skilled compliance team with strong regulatory knowledge to monitor and implement new laws, communicate requirements across departments, and prevent non-compliance by coordinating with product development and senior management.

Maintain a centralized, up-to-date compliance database that records laws, circulars, and compliance requirements, identifies risks, applies controls, tracks breaches, and reports to the compliance management committee and board with dashboards.

Coordinate with regulators and law enforcement to review transactions, identify suspicious activity and suspicious transaction reports, and file cash transaction reports under the chief compliance officer's approved program.