Fcc Risk Models – Methodology Owner

Job description

Role Title: FC Risk Models – Methodology Owner
Business: Financial Crime Compliance – System Controls and Analytics (SCA) Department
New or Existing Role? New
 
Role Purpose


Background & Overview

In early 2013, HSBC began to transform its existing Compliance team into two distinct sub-functions: Financial Crime Compliance (FCC) and Regulatory Compliance (RC). The  dual focus on financial crime compliance and regulatory compliance shows a strong commitment, not only to our responsibilities under the deferred prosecution agreements and cease and desist orders in the US and UK, but also to building a robust and effective framework to address anti-money laundering, sanctions and anti-bribery and corruption risks to our bank.

FCC is focused on: Anti-Money Laundering (AML), Counter Terrorist Financing & Proliferation Finance, Sanctions and Anti-Bribery and corruption (AB&C).

In April 2014, version 1.2 of the Financial Crime Customer Risk Assessment Methodology (FCC-RAM) was released for implementation. As a key control in the management of financial crime risk, the FCC-RAM will provide a risk assessment for each customer globally, across all four lines of business. The Global FCC-RAM adopts four risk factors, each a composite, with associated weightings (i.e. Country Risk, Business Type and Occupation Risk, Legal Entity Structure Risk and Product Risk) and a risk rating / scoring approach. Each of these factors has a risk rating model which is used to assess a customer.

The output will drive the level of customer due diligence (CDD) performed for each customer and the frequency with which CDD must be refreshed. This will allow a customer’s Financial Crime Risk Rating (“FCRR”) to be assessed consistently at on-boarding and throughout the relationship, irrespective of where the customer relationship is managed. This is a significant step forward in developing our Global CDD Standards and ensuring a consistent approach to risk rating our clients across the Lines of Business (LoBs).

A review of the FCC-RAM and its components identified areas for strategic improvement. These included the requirement for a robust validation process and a fully documented and quantitative justification in support of the selection of the model scores and factor weights.

In addition to address the issues identified in the existing models, the Global Head of FC Risk Models will develop strategic plans for FC Risk measurement and management by pursuing an increased focus on advanced modelling techniques to improve customer profiling and to identify trends and patterns indicative of financial crime and FC risk.

The role holder will be responsible to support the Global Head of FCC Risk Models in defining and driving these strategic plans.
 
 
 
Key Accountabilities
Impact on Business


The role holder will be directly responsible for the development of sound but transparent quantitative methodologies, in support of the bank’s FC Risk Management Framework and in conjunctions with the model owners.

Changes in the FC Risk models can have significant impacts and lead to, for example:

An  increase in the population of medium and high risk customers from the FCC-RAM, which will mean a higher level of due diligence is required to be performed on them, leading to significant cost and operational impacts

An increased number of alerts from Transaction Monitoring systems raised, which again could have an operational and cost impact

An increased focus on a country , due to the model’s use in EWRA and AML Risk Management.
 
The role holder will be responsible for:


Maintenance and sustainability of the Group model methodology

Designing a strategic plan to drive measures of risk that are objective, transparent, intuitive and predictive.

Engaging with Risk Model Owners to guide and support developments and enhancement of the FC risk models, in relation to the underlying methodologies, model structure and design.

Articulating data requirements in support of ongoing and future model development, enhancement or validation activities.

Supporting and guiding the Model Owners in meeting the documentation and validation requirements for all models and their components.

Keeping abreast of industry and regulatory developments in FC Risk quantitative methodologies and model risk management.

Working with the Model Owners to support, enhance and shape activities around ongoing model validation or independent model review.

Undertaking scheduled reviews of model methodology and ensure alignment with key regulatory and industry guidance
 
Customers / Stakeholders


The Methodology Owner will work closely with the Global Head of FC Risk Models and other relevant Risk functions to develop and enhance the Risk Models to align with the broader risk management framework and model governance.

Responsible for consulting with the Model Owners, Region and Business to identify specific risks to be considered as part  of the FC Risk model methodologies.

Closely collaborate with the Heads of AML and Sanctions
 
 
Leadership & Teamwork


Partner with AML and Sanctions leadership on developing AML and Sanctions strategies and methodologies, new risk practices in accordance with the RAM, policies and procedures which can be effectively shared across HSBC

Partnering with the Global FC Risk area (such as FCC & RC Risk Strategy, Model Oversight Committees and independent review teams), provide advice and guidance to lines of business in the development and utilization of financial crime risk methodologies

Partnering with Policy, act as an ongoing liaison with lines of business to facilitate their access to the resources and information available at the Global FC compliance level
 
 
Operational Effectiveness & Control


Identify opportunities for process,  data, methodology and system improvements to support development of robust and business-relevant risk metrics

Provide solutions to complex global issues/initiatives in an ever changing, high-risk environment

Detect and investigate reasons for model ineffectiveness and model misuse

Work with Model Owners to create a framework for the effective risk-based monitoring of the FC Risk models

Agree and oversee the monitoring of the adherence to relevant elements of those policies

Proactively identify, manage and mitigate control failures and cases (including customer related cases) involving  the FC Risk models

Maintain and observe all HSBC control standards and implement and observe the Group Compliance Policy, including the timely implementation of recommendations made by internal/external auditors and external regulators
 
 
Major Challenges


Navigating – understanding and translating information on changing drivers of FC risk into the model and managing how these affects outcomes for HSBC.  Change delivery objectives and align directions accordingly

Aspiring – making HSBC compliant with regulatory expectations in a sustainable manner being ambitious about providing the highest standards of delivery

Driving – setting stretching goals for self and teams and delivering them with courage and tenacity
 
 
Role Context


The jobholder is required to work with considerable autonomy, dealing with major issues for which there is no clear cut solution while still being able to provide judgement and clear direction. Where items of major consequence are involved, reference is made to the Global Head of FC Risk Models.  The nature of the role requires close working contact with senior executives in FCC and across the Global Lines of Business.
 
Role Dimensions


The jobholder’s responsibilities cover all material relating to FC risk models, cross border FC issues, and the proactive identification of risk factors which may lead to them.
 
 
Management of Risk


The jobholder is responsible for ensuring that the FCC Risk Model standards are in accordance with the Group Standards Manual and that the FC policy aspects of the Legal & Compliance FIM are effective and relevant.
 
 
Observation of Internal Controls


The job holder will maintain HSBC internal control standards, including timely implementation of internal and external audit points together with any issues raised by external regulators.

Jobholder is required to manage FCC responses to adverse Compliance metrics, including unsatisfactory FCC Reviews and Audit reports.

This will be achieved by adhering to all relevant processes/procedures and by liaising with Compliance department about new business initiatives at the earliest opportunity. Also and when applicable, by ensuring adequate resources are in place and training is provided, fostering a compliance culture and optimising relations with regulators.

The jobholder will also adhere to and be able to demonstrate adherence to internal controls. This will be achieved by adherence to all relevant procedures, keeping appropriate records and, where appropriate, by the timely implementation of internal and external audit points, including issues raised by external regulators.
 
 

Desired profile

Knowledge & Experience / Qualifications


Seasoned quantitative professional with experience in one or more risk modelling roles

University degree and / or Ph.D. in a quantitative field

Good understanding of statistics and data mining and familiarity with sophisticated tools for numerical analysis (e.g. SAS, SQL, etc)

Experience in leading and conducting model development and validation work in a similar or complementary discipline

Knowledge of FC regulations and guidance would be a clear advantage

Significant experience in the financial services industry

Lateral thinker with an ability to interpret and solve complex issues

Excellent communicator with strong inter-personal and influencing skills

Ability to lead change, contributing to joining up with the other teams in Risk and Business globally

Experience of dealing with regulatory matters and confident interaction with Regulators

Ability to develop practical, cost effective solutions to complex global issues
 
 
 
 
 
We are an equal opportunity employer and are committed to creating a diverse environment.

About HSBC

HSBC est l’une des plus grandes banques internationales avec une présence dans plus de 85 pays dans le monde. Elle a été créée en 1865 sous le nom de « The Hongkong and Shanghai Banking Corporation », et son siège social est basé à Londres. En France, HSBC totalise environ 400 agences et près de 10 000 salariés, avec une spécialisation dans plusieurs activités : une banque pour les particuliers, spécialisées notamment dans la gestion de patrimoine, une banque privée (gestion de fortune), une banque d’entreprises, qui s’appuie sur le réseau de l’ensemble du groupe HSBC dans le monde, et une banque de financement, d’investissement et de marchés. En 2012, HSBC France a réalisé un résultat avant impôt de 450 millions d’euros.