Tracy Manning is the Director of Financial Crime at LexisNexis Risk Solutions, and is Tom Fox’s guest this week on this episode of the Innovation In Compliance Podcast. She is a digital identity and financial crime expert, and currently leads the Commercial Strategy and Product Innovation for Financial Crime Market at LexisNexis. In this episode, Tracy and Tom are discussing the growth of digital transactions in the past year and what issues it may pose for compliance.
The Growth of Digital Transformation
Tracy remarks that the pandemic spurred digital growth, especially digital transactions. Digital commerce grew 44% last year, and its rate of acceleration is about five to seven years ahead. She adds that surveys show that these trends will not reverse, even as the world reverts to pre-pandemic environments.
Greater the Explosion, Greater the Risk
“With this explosion obviously we have greater opportunities, but I think perhaps greater risk,” Tracy says. While the vast growth of digital transformations is a plus and makes for greater opportunities for companies with respect to data, it also poses greater risks. Criminals have found new ways and schemes for evading financial crime control. Tracy explains key ways they leverage the anonymity of these faceless transactions. She adds that the onus is on companies to protect consumer data from these bad actors.
Key Questions & Guidance
Now that businesses are physically reopening, Tom asks Tracy to share some advice LexisNexis gives to companies. Tracy explains that companies are stumped on how they can transform their processes to better identify financial crime risk, create better customer experiences, and meet the emerging regulatory requirements. She adds that the most important challenge companies seek help with is achieving all these simultaneously. LexisNexis counsels these companies to keep their eyes on recent enforcement and newly published guidance due to the emergence of new threat schemes. It’s also important for companies to have a tool that can effectively meet regulatory demands, which can also create an improved customer experience. “Looking at digital identity is very, very critical…Digital evasion requires digital solutions,” she tells Tom.
What’s Next
As digital transactions evolve, Tracy stresses that companies need to evolve their compliance for this new digital normal by applying additional layers of digital identity intelligence within their organizations in a multi-layered approach. “An additional layer of digital identity intelligence is absolutely key to optimizing the customer experience…It can potentially allow you to identify good trusted customers and expedite their experience,” Tracy tells Tom. She adds that to fight financial crime, as well as having an additional layer of digital identity, companies need to have networks of their own.
Resources
Tracy Manning | LinkedIn | Twitter
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Data Transfers into the UK
Following the EU’s adoption of Adequacy Decisions that the Kitchen covered in a prior episode, the UK’s Department for International Trade issued an updated guidance on data transfers into the UK. The Kitchen takes a look at the guidance that points to sources on data transfers, IP, copyright and data protection both coming into and leaving the UK.
In this episode of Greetings and Felicitations, I am joined by Astrophysicist and Healthcare Futurist Ben Locwin. In this podcast we consider the TOS episode Mirror Mirror as a starting point for the consideration of the science around the transporter.
In this episode, a landing party Kirk, McCoy, Scotty, and Uhura beams back up to the Enterprise. Interference from an ion storm, however, causes them to be transported into a parallel universe and a mirror image Enterprise. Now aboard the Imperial Starship Enterprise, the landing party discovers crew members who are mirror images of themselves and belong to an evil Federation known as the Empire. Their first experience is the torture of transporter operator Mr. Kyle with an agonizer for his alleged failure to beam the landing party up quickly enough. Immediately, Kirk realizes that a mirror image landing party must have been beamed aboard the real U.S.S. Enterprise.
Kirk, Uhura, McCoy, and Scotty impersonate their mirror image counterparts while finding a way to return to their universe. When Kirk and the party return, they find that their Empire counterparts were immediately recognized and put in detention. The Enterprise’s crew attributes this to the fact that it is easier for logical men to appear barbarous than for barbarous men to appear civilized.
Highlights include:
- Quantum transportation of information.While we cannot yet teleport, we can recreate.
- How does the telegraph signal explain this science used in Star Trek?
- What about the radio signals from the Apollo moon flights?
Laura Tulchin is ESG Solutions Lead at Exiger. Her role involves ensuring that the company’s products and services provide comprehensive coverage of ESG risk. She tells Tom Fox that more and more companies are focusing on ESG as part of their mainstream risk management programs. She joins Tom in this episode of the ESG Report to talk about doing ESG right by managing risk and value generation.
Getting ESG Right
“Where we get ESG right, we have the potential to have decades of positive impact on the world around us,” Laura tells Tom. ESG is having a moment now, she says, so now is the time to take the steps necessary to move the industry forward. Getting that right will have a lasting impact. She and Tom discuss global and local advancements in ESG regulations. US regulators are getting serious about ESG, Laura says. She talks about the SEC Enforcement Task Force as well as the ESG Disclosure and Simplification Act. This demonstrates that regulators want companies to back up their ESG claims with real data.
The Need for Standardization
There are multiple ESG reporting mechanisms existing today, Laura tells Tom. This causes fragmentation and is costly and ineffective. Also, she argues, it “allows companies to choose the reporting standard that might make them look the best from an ESG perspective.” For this reason, five of the leading standards setters have agreed to work together on a comprehensive standardized ESG reporting system. She acknowledges that no one system will perfectly cover every ESG situation, but standardization is an important first step. Tom asks why she thinks companies are pushing back against standardization. They’re mostly worried about the legal ramifications, she responds. “ESG is so impactful,” she remarks, “that if we don’t have a single benchmark it makes it really difficult for consumers, for investors, for risk managers, for compliance people to really understand ESG risks as well as the potential for ESG value generation.” Ultimately, ESG risk needs to be balanced with ESG performance to measure net impact, Laura says. That’s where the industry is going.
The G in ESG
Tom asks Laura to share her thoughts on the recent Exxon case. Should there be more focus on the G in ESG? “Good governance should ultimately lead to strong environmental practices and strong social engagement,” Laura agrees. The Exxon case demonstrates that going forward, companies need to engage shareholders and stakeholders, even though their views on ESG issues may be different. These changes are here to stay, she argues. Forward-thinking companies will try to understand ESG net impact and craft programs that respond to these types of actions.
Resources
Laura Tulchin on LinkedIn
Exiger on Website | LinkedIn
In this Episode of the FCPA Compliance Report, I am joined by Cristina Revelo. Cristina got a PhD in Compliance working at KPMG on the Wal-Mart account and later went in-house at Wal-Mart. She has a great story about how on the job training has given her a PhD in Compliance. She is now Deputy Director, Corporate Monitoring and Compliance Services at Affiliated Monitors, Inc. Highlights include:
- Her undergraduate career at University of Illinois and degrees in accounting.
- Her work at KPMG.
- What was it like moving over to Wal-Mart.
- What it was like doing compliance at the world’s largest retailer.
- Her current role at Affiliated Monitors.
Resources
Cristina Revelo Profile on LinkedIn
Affiliated Monitors
The Compliance Handbook
In today’s edition of Daily Compliance News:
- Do GenZs want to end email?
- Palestinian Authority and corruption.
- NRA and Bankruptcy fraud.
- FAQs on Biden EO.
In today’s edition of Sunday Book Review:
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From Russia With Love
The Kitchen looks at what has been cooking in the Russia’s Prosecutor General’s office as they add several more foreign NGOs to its “undesirable entity” list.
In today’s edition of Daily Compliance News:
- EU slams VW and BMW over collusion. (NYT)
- Biance bolsters compliance. (WSJ)
- Pentagon to go with multi-cloud approach. (WSJ)
- Juul and academic corruption. (American Prospect)