Tyson Wienker, Director of Strategy, Technology & Product Development for LexisNexis Pacific discusses the true cost of bribery, how can organisations improve their due diligence processes, emerging technologies & their impact on global risk and compliance at the GRC/ACI Conference, Gold Coast, November 18-20, 2012.
How can companies improve their due diligence processes?
1. How can companies
improve their due
diligence processes?
Tyson Wienker
Director of Strategy, Technology & Product Development, LexisNexis Pacific
GRC/ACI Conference, Gold Coast, November 18-20, 2012
2. Agenda
1 The True Cost of Bribery
2 A Global Perspective on Corruption
3 On the home front: Bribery Down Under
4 How can organisations improve their due diligence processes?
5 Emerging technologies & their impact on GRC
6 A Changing Landscape: Big Data and the future
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3. The true cost of bribery
BY THE NUMBERS “A consensus has now been reached
that corruption is universal. It exists in
• The World Bank estimates that each year all countries, both developed and
bribery and corruption results in the developing, in the public and private
misdirection of US$1 to US$1.6 trillion globally. sectors, as well as in non-profit and
charitable organisations”
• Corrupt practices costs companies as much as Asia-Pacific Development Journal
35% of the cost of doing business in Asia.
THE GREATER COST
$
• Creating uneven competitive environments
• Undermining business and consumer confidence
• Discourages investment through market instability $1.6 trillion
• Undermining environmental protections
• Flow on ‘blind eye’ effect on other criminal activity
Sources: Ernst & Young, Upping the Ante Report, 2010;
Transparency International New Zealand
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4. A global perspective on corruption
70% of countries in
regions Australian
organisations trade in
pose a serious
corruption risk
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5. Risk & Compliance: Bribery Down Under
• More than 34% of AU & NZ organisations are 54% indicated that the
operating in high risk jurisdictions level of corruption in
Australia had increased
• One in five of these organisations have identified in the previous three
an incident of bribery or corruption in the past five years.
years, with around 60% of these incidents occurring
in the past 12 months alone. Transparency International’s
Global Corruption Barometer
2010/2011
• Despite this, 80% of organisations with offshore
operations either do not regard foreign bribery and
corruption as one of the top five risks in the next LexisNexis Bribery
five years. Awareness Index
LexisNexis AU/NZ Bribery Awareness Index 2012
Media coverage of
122%
120%
bribery incidents has
118% increased by 10% in
116%
114% past three months
112%
110%
108%
106%
Sources: Deloitte Bribery & Corruption Survey, AU & NZ, 2012;
Aug Sep Oct LexisNexis Bribery Awareness Index, November 2012
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6. Risk
Ri & Compliance: AML/CTF Perspective
Reports of suspicious
transactions have
nearly doubled in
past 5 years
Source: AML & CTF regime in Australia, Australian Institute of Criminology Report, 2012
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7. The challenges of customer risk for businesses
Key verification
challenges
• Foreign Governments
• Politically Exposed
Persons
• Foreign Companies
Source: AML & CTF regime in Australia, Australian Institute of Criminology Report, 2012
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8. The hard labour of due diligence
Two-thirds of
Australian businesses
are reliant on manual
due diligence
processes
48% of AU & NZ
organisations do not
have any formal policy
or compliance
program to manage
corruption risks.
Source: AML & CTF regime in Australia, Australian Institute of Criminology Report, 2012
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9. How can companies improve their due diligence processes?
The three elements of effective due diligence processes
Identity Sources of Beneficial Group Incorporation
1 IDENTIFY documents wealth & funds ownership structure documents
Company Negative
Sanctions & PEP Legal
2 VERIFY watchlists Lists
structure &
ownership
cases
news
monitoring
Negative
3 MONITOR Sanctions &
watchlists
PEP
Lists
news
monitoring
ONBOARDING ONGOING
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10. How can companies improve their due diligence processes?
The three elements of effective due diligence processes
Identity Sources of Beneficial Group Incorporation
1 IDENTIFY documents wealth & funds ownership structure documents
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11. How can companies improve their due diligence processes?
The three elements of effective due diligence processes
Identity Sources of Beneficial Group Incorporation
1
1 IDENTIFY documents wealth & funds ownership structure documents
Company Negative
Sanctions & PEP Legal
2 VERIFY watchlists Lists
structure &
ownership
cases
news
monitoring
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12. How can companies improve their due diligence processes?
LexisNexis Diligence assists in cost-effective, authoritative
verification and monitoring of critical information sources
Identity Sources of Beneficial Group Incorporation
1
1 IDENTIFY documents wealth & funds ownership structure documents
Company Negative
Sanctions & PEP Legal
2 VERIFY watchlists Lists
structure &
ownership
cases
news
monitoring
Negative
3 MONITOR Sanctions &
watchlists
PEP
Lists news
monitoring
ONBOARDING ONGOING
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