Financial Crime Solutions provides online auditing tools to help businesses manage compliance and risk

Financial crimes like fraud, money laundering, bribery, and corruption only make it onto the average person’s radar through either sensationalist news headlines concerning high powered politicians or business leaders, or crime procedurals on TV. However, these crimes – or, specifically, ensuring they don’t occur – can be costly, on-going headaches for thousands of businesses big and small across sectors varying from superannuation through to gambling.

Businesses covered by the federal Anti-Money Laundering and Counter-Terrorism Financing Act of 2006 (AML/CTF Act) must have an AML/CTF program in place, with the program’s compliance with federal regulations to be independently audited; these businesses are also encouraged to assess their risk of other financial crimes. The costs of not doing so are high: global banks have paid a combined US$261 billion in fines for non-compliance since 2008.

However, not every company with these obligations can afford to hire a big consulting firm to conduct audits or risk management checks. Sydney startup Financial Crimes Solutions (FCS) is looking to be the solution for these smaller companies, creating financial crime audit and risk management software to make the process accessible for all regulated entities, regardless of their size, industry sector, or geographic location.

Explained founder Anthony Quinn, “There’s 40,000 regulated entities in Australia, with this number growing, and typically the solutions available at the moment aren’t accessible to the large majority of those. We are trying to commoditise some of the professional services and knowledge around financial crime risk management practices into our software and distribute that to all of those reporting entities.”

Quinn has a deep background in the space, having worked in London as a consultant in the banking sector before moving to Australia to become program director of an anti-money laundering program for Macquarie Bank. With this program going through independent audits that were both time and manually intensive, it was from there that the idea for FCS came.

FCS essentially comprises two platforms, the first of which is an AML/CFT health check, a tool that helps entities assess their compliance against regulations, track and manage actions, issues, and risks, and compare results across specific metrics or company divisions.

The tool, currently customised for users in Australia, Hong Kong, New Zealand, the UK, and the US, works by having users provide commentary on each of their obligations and aspects of their program, assign a compliance rating, and attach documents as evidence.

Similarly, the second is a risk assessment platform, encompassing separate tools for identifying, assessing, mitigating, and managing risk across the areas of money laundering, anti-bribery, fraud, various countries, and IT infrastructure.

The anti-bribery tool, for example, contains over 300 risk factors across 40 industry sectors, with users able to tailor these to suit their requirements. The tool then allows users to assess inherent risk, calculating likelihood by impact, and assess the effectiveness of any mitigating controls. It then generates a report containing analytics and recommended actions.

Quinn explained, “Traditionally this is done on spreadsheets, which is a pretty woefully inadequate way of performing risk assessment, so we’ve built a lot of capability we just know doesn’t exist out there in the market. It doesn’t exist in any of the big consulting firms, or in any of the banks, because we’ve been talking to them all.”

These tools are SaaS-based, though they are also able to be deployed on premise or on a private cloud. With the startup looking to smaller companies, Quinn said the startup has priced its tools “in a way that is affordable” and organisations of all sizes and competitive when up against other offerings in the market.

FCS has also had “meaningful conversations” with a number of financial institutions and consulting firms in different countries around the licensing of its software, with Quinn saying he has talked to institutions in the UK and Asia as well as Australia.

Working at Macquarie Bank four days a week and on FCS in his spare time for several years, boostrapping its development, Quinn went full time at FCS last year.

The startup raised a $600,000 seed funding round towards the end of last year to help further its growth, with new products to come. Quinn said FCS is currently working on a bribery healthcheck or audit tool, as well updates to the risk assessment tools ahead of a relaunch later this year.

Original link: http://www.startupdaily.net/2016/03/financial-crimes-solutions-provides-online-auditing-tools-help-businesses-manage-compliance-risk/