A listed UK-Based subprime lender offering lower value short term loans needed to enhance, redesign, and implement a new FC framework. Lysis provided the client with a understanding of risks, practical advice on risk mitigation, & robust policies.
Retail Banking
Financial Crime Framework Review and Enhancement
A listed UK-based subprime lender that offers lower value short-term loans, either unsecured or with a guarantor, to individuals who are unable to secure or qualify for a loan from the mainstream financial firms mainly due to their financial circumstances and who may also be considered vulnerable customers.
Due to the specific industry that the client operated in, they had a strong focus on the prevention of fraud but had little expertise about how to mitigate the risks associated with their business environment. Through workshops, Lysis was able to impress upon the client the risks faced by the business and advise on implementing proportionate controls which would operate under a mix of manual and automated functions to be effective in mitigating the FC inherent risks. Lysis further guided the client on the requirements for a robust FC governance and operational structure. Lysis successfully redrafted some of their existing policies and wrote additional policies, in readiness for the launch of their new product, that met the specific financial crime requirements as determined by the FCA. This included a comprehensive financial crime policy, a risk rating policy, Financial Crime Risk Assessment, Client Risk Rating, Risk Assessment Statement, Risk Assessment Methodology as well as the TM and on-boarding procedures. Lysis conducted a number of workshops to include the business, the FC operations and FC specialist team that specifically focussed on the requirements to launch their new product offering, how to manage the process going forward whilst remaining compliant. The workshops increased the level of knowledge regarding financial crime across staff from the 1st and the 2nd line of defence of the organisation. Lysis further engaged with their third-party providers to gain a clear understanding of the services offered and to ensure their functionality for onboarding, screening, transaction monitoring, management of alerts etc., were aligned with the client's policies and procedures and could be managed in a highly effective and efficient manner.
Although the client is based in the US, they have European subsidiaries which include the UK and therefore required Financial Conduct Authority (FCA) registration. In order to obtain registration as a crypto asset firm in the U.K. they had to comply with specific FCA requirements.
A crypto asset custodian based in the U.K. with global reach approached Lysis with the request to assist them with the process to obtain registration from the FCA which would enable them to operate in the UK market as a crypto asset business. Due to the holding company’s strong global footprint, part of the FCA requirements for registration included the need for a UK based money laundering reporting officer (MLRO).
Our client was in the middle of an extensive regulatory remediation for the Central Bank of Ireland and the remediation.
