‘Financial Institutions Should Develop Understanding of Emerging Regulatory Scope’

Isah Aminu Buhari is the Vice President, Compliance Institute, Nigeria(CIN) and Co-Chair, Association of Certified Anti -Money Laundering Specialists (ACAMS). He speaks with Adedayo Adejobi on why financial institutions should seek to develop an understanding of the emerging regulatory scope, including the new risk environment.

Amongst the committee of nations, Nigeria’s Competency framework has been brought to the fore, especially in the areas of regulatory compliance. One organisation saddled with the task of enforcing and championing compliance amongst corporate organisations across various spheres of influence is the Compliance Institute Nigeria. And by virtue of it’s roots being from the Association of Chief Compliance Officers of Banks in Nigeria (ACCOBIN), and its recent recognition by the IFCA, Nigeria and its compliance industry, have been a major focus on the global stage, as the world focuses on its crucial role in entrenching optimal regulatory compliance philosophy among financial institutions.

Speaking to THISDAY on the unique essence of the institute since its inception, Isah Aminu Buhari, Vice President, Compliance Institute, Nigeria (CIN) and Co-Chair, Association of Certified Anti -Money Laundering Specialists (ACAMS), said, ‘‘The Compliance Institute for Banks and Other Financial Institutions in Nigeria Ltd/GTE, also known as “Compliance Institute, Nigeria” (CIN) was registered in January 2015. The Institute was established to encourage, promote and revive the consciousness for regulatory compliance within and outside the financial industry in the country. The Institute seeks to build a body of professionals and corporate organisations that would be recognised for integrity, professionalism, and strict adherence to regulatory and non-regulatory standards in and outside the business environment. The Compliance Institute Nigeria, which draws membership from employees and directors within the financial industry while it’s equally open to interested members of the Nigerian public, has come a long way since inception, receiving generous acceptance from stakeholders. Highly recognised not only by the financial institutions but also by the regulatory authorities such as the CBN, NDIC, SEC, NAICOM, and Law Enforcement Agencies (LEAs) such as the EFCC. Today, membership of the Institute is considered a pre-requisite for working in the compliance department of any financial institution in Nigeria. The Institute is, therefore, a generally recognised body for compliance professionals within the financial industry in Nigeria.

Hinting on the institute’s plans to entrench optimal regulatory compliance philosophy, Aminu disclosed that, ‘‘To strengthen and enhance the acceptability of CIN, the Institute is currently engaging the CBN with a view to incorporating CIN certifications into the CBN competency Framework Policy. Regarding the potential impact of the alliance between the Compliance Institute, Nigeria (CIN) and the regulatory authorities, I can say with confidence that by virtue of its mandate and the strategic relationship with regulatory authorities, the Institute would play a crucial role in entrenching optimal regulatory compliance philosophy among financial institutions for a mutually beneficial relationship. ‘’

A major area of its strength is striking purposeful alliances across global institutions like the Centre for National American Security. Speaking on the import of Nigeria’s participation in the second IFCA ICC, Global conference, Isah Aminu Buhari was quick to note that ‘‘As part of Compliance Institute, Nigeria’s (CIN) international partnership drive, the Institute engaged and obtained membership of the International Federation of Compliance Associations (IFCA). IFCA was formed in Dublin on November 23, 2010. It is the umbrella organisation for professional bodies that specialise in the practice of compliance. Membership is open only to not-for-profit associations and professional bodies, such as Compliance Institute, Nigeria (CIN), that have a primary focus to promote compliance, ethics, and the career progression of their respective members. So, in effect, membership comprises national compliance bodies from around the world that have been established for the benefit of the compliance profession and its members. In a nutshell, the purpose of IFCA is to be the global voice of the Compliance Profession. As you might be aware, the CIN became a full member of IFCA on September 22, 2020. By becoming a member of IFCA, the CIN gained access to a global platform amongst other Compliance professionals and other stakeholders. It means the CIN certifications will have global recognition. It also means the Compliance Institute, Nigeria (CIN) will on an ongoing basis, have access to international professional networks and best practices.’’

Disclosing plans on efforts made at being chartered, he said, ‘‘the Compliance Institute, Nigeria has engaged a consultant to facilitate the achievement of this objective. The Institute intends to engage the Central Bank of Nigeria to sponsor a Bill for a charter at the National Assembly. This will no doubt lend more credibility to the process and as you know there is a nexus between enhanced regulatory compliance and the promotion of a sound financial system which is a core mandate of the Central Bank of Nigeria. We are committed to the course we have chosen for our great Institute and our dream is to become chartered by the end of 2021.’’

Although not a profit-making institution, it has been able to achieve the profit of improved knowledge of Compliance in Nigeria?, Aminu enthused in these words, ‘‘As you are aware, the Compliance Institute, is guaranteed by trustees and as such it is not a profit-making body. Right from inception, the Compliance Institute, Nigeria Board Of Trustees directors have been working on pro-bono. As the Institute’s membership base increased over the years, revenue acquired largely from membership fees are used to fund the institute’s activities.

Additionally, most of the institute’s operations are carried out virtually and this has further reduced overhead costs over the years. The institute has since achieved break-even and is already self-sustaining. The success and achievements recorded by the Institute thus far were out of sheer sacrifice and astute management and direction provided by the Board Of Trustees directors under the leadership of Mr. Pattisson Boleigha.’’

Like every sector of the economy, the Institute and the compliance industry has been equally affected. Shedding light on how the pandemic has affected compliance and how compliance has evolved locally and globally, these words, sufficed, ‘‘The COVID-19 pandemic has led to unprecedented global challenges, human suffering, economic disruptions, and an increase in COVID-19-related crimes. Since the start of the pandemic, criminals have sought to exploit the crisis to commit scams, fraud, and cybercrime. When we were looking at the Institute’s prospects and challenges in the first weeks of 2020, the first reports about Covid-19 were just emerging. Then everything changed. Little did we know how it would come to change both our personal and professional lives. We could therefore be forgiven for not featuring it as part of our Compliance Challenges as practically no one in the world took it seriously enough, except perhaps China.’’

With hindsight, the institute’s technology-driven process from inception has signaled its winning edge, Isah Aminu Buhari, Vice President, Compliance Institute, Nigeria (CIN) noted, ‘‘From inception, the operations of Compliance Institute, Nigeria have been IT-driven. Though it has a physical presence, Compliance Institute, Nigeria was created to operate almost virtually. Therefore, when the COVID-19 national protocol required working virtually Compliance Institute, Nigeria was more than ready, and we immediately adopted the protocol seamlessly. Classroom lectures, Board Of Trustee directors meetings, Annual General Meeting, and induction ceremonies were conducted virtually and with ease by the secretariat staff who also had to work remotely under close monitoring by the Board Of Trustee. In support of the government’s presidential directives on Covid-19, the Compliance Institute, Nigeria is championing compliance with COVID-19 measures. As the restrictions associated with the pandemic start to ease, many organisations will never be the same again. For smaller businesses, it is easier to return to a full office working model than big organisations. However, employee expectations have changed, forever. Whilst it is envisioned that many technology companies will move to a full remote working model after the pandemic, for financial services, the most likely outcome is that a significant percentage of the workforce will be working remotely.’’

Emphasising the fact it’s not yet Uhuru for all, he underscores the role compliance plays in the scheme of things, saying, ‘‘The biggest change is that firms will need to look at their compliance risks again, but this time on a longer-term basis. The management of conduct risk is the biggest challenge in these circumstances. Conduct risk is broadly defined as any action of a financial institution or individual that leads to customer detriment or that has an adverse effect on market stability or effective competition. The issues are many and varied, including the management of front office staff, ensuring that documentation is properly maintained and disposed of, trades are carried out in a timely manner and client access via telephone/online is maintained when necessary. Remote oversight is likely to form a more prevalent component of risk management, including the management of compliance risks, which also includes the prevention of market abuse, inappropriate advice, and lack of adherence to sales-related procedures. As we move to the third quarter of 2021, financial institutions should seek to develop an understanding of the emerging regulatory scope, including the new risk environment in which they will be operating. In addition to managing their compliance resources and training compliance staff, financial institutions will need to review their compliance resilience to adequately adapt to the ever-changing regulatory landscape, on an ongoing basis. As COVID-19 infections have mushroomed with the Delta variant, the remaining months of 2021 are likely to be taken over by the immediate response to the pandemic. But beyond that, vaccination offers the hope of a more stable future – an environment where organizations can, and will be expected to, focus on compliance again.’’

When the reporter asked about the institute’s strategic alliance with the Centre for National American Security (CNAS) and what it portends for Nigeria’s Compliance Industry, ‘‘The Center for a New American Security (CNAS) is an independent, bipartisan, non-profit organisation that develops strong, pragmatic, and principled national security and defense policies. CNAS engages policymakers, experts, and the public with innovative, evidence-based research, ideas, and analysis to shape and elevate the national security debate. A key part of its mission is to inform and prepare the national security leaders of today and tomorrow. CNAS is located in Washington and was established in 2007. Since the Center’s founding, its work has informed key the United States of America’s strategic choices and has been acted on by Republican and Democratic leaders in the executive branch and on Capitol Hill. CNAS in conjunction with CIN held its first and second workshops in May 2019 and September 2020, respectively. The first workshop provided practical advice on North Korea sanctions and counter-proliferation finance standards for compliance officers in Nigeria. It covered key aspects of compliance, including United Nations Security Council Resolutions and other relevant international-level sanctions on North Korea; FATF recommendations and guidance on proliferation finance; and typologies of North Korean sanctions evasion activities, including a review of several relevant case studies, including case studies in Africa. The second workshop was virtual and provided Sanctions Implementation Update on significant developments on sanctions since August 2019; trends in the use of cryptocurrency to evade sanctions and compliance best practices for companies involved in cryptocurrency, and Challenges in Sanctions Compliance. Hundreds of our members attended the two workshops and enhanced their capacity on sanctions and cryptocurrency issues and why complying with these sanctions is very important. The workshops were rich, educative and got quite a lot of positive feedback from our members. Clearly, CIN’s collaboration with such a strategic organisation as CNAS has exposed our Institute to global visibility and recognition. ’’