Regulatory Alerts2012-03-22
Compliance and the Compliance Function in a Banking Corporation
The Supervisor of Banks issued this directive to mandate that banking corporations establish an independent, permanent compliance function to manage compliance risk and prevent material losses. The document requires the board of directors and senior management to approve a comprehensive compliance policy, allocate adequate resources, and ensure the Chief Compliance Officer has the authority and independence to oversee adherence to laws and internal standards. It further details the specific duties of the compliance function, including risk assessment, employee training, monitoring, and reporting, while defining its role as the second line of defense within the corporation's corporate governance structure.
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