Newgen Presentation on FATCA


Published on

Newgen helps organization’s gain FATCA compliance through a thought leadership approach. It provides Financial Institutions with robust FATCA compliance software and also help them create step by step approach for a comprehensive compliance strategy.

To know moe visit

Published in: Technology
1 Like
  • Be the first to comment

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide
  • Put Indian Banks First
  • Newgen Presentation on FATCA

    1. 1. Newgen Presentation on FATCA
    2. 2. • 12 weeks before we hit FATCA deadline • If you have not yet started, think about Assessment, Gaps, Rules, Audit, Reports... Risks • Adapt to the change and then change to Last The Clock is Ticking
    3. 3. What are the main Challenges for Banks? • Regions: AsiaPAC, North America, Europe • Sample Size: 63 Organizations • Interviewees:  CIO’s  Compliance Head  Head of Risk  Operation Managers Key findings from Survey conducted by Newgen Time is Critical- Pre-Configured Templates Unpredictable FATCA regulations- Agile BPM Platform Ensure Compliance– Logs and Document Management Solution Complicated FATCA Procedures - Case Management and Workflow Monitoring and Reporting Tools needed – Configurable Reports using Reporting tool Customer Relationship - Communication Management 23 Countries 92 Compliance Officers 63 Financial Institutions 1 2 3 4 5
    4. 4. • FATCA compliance is a derivative of Core Banking/AML?  FATCA needs comprehensive, risk mitigation and case management approach. • FATCA is not my problem, it is the compliance or legal or technology or ???  FATCA requires program governance and ownership with joint participation and alignment. • FATCA is about identification, I guess ?  Cursory analysis of customers is not enough. Needs domain experience and ability to execute. • FATCA is all about IRS ?  FATCA is not a one time, quick fix solution. Sons and Daughters of FATCA are just shaping up. The Myth Busters
    5. 5. • Regulation to combat offshore tax evasion on US source income maintained with FFI • Goal: Identify US Person status and accounts held by such individuals & entities (>10%) • Approach: US Indicia based & above certain aggregated account balance threshold • Documentation Collected: If US Indicia identified, additional documentations required which are beyond AML obligations • Additional Complexities: Change in circumstances, 30+ statuses, repeatable remediation procedure, unpredictable changes in regulation expected in future FATCA • Aims to check money laundering • Goal: Identify Beneficial Owner who owns or controls the account / customer (>25%) • Approach: Risk Based approach • Documentation Collected: Mainly for identifying beneficial owner Anti-Money Laundering Purpose of AML and FATCA
    6. 6. FATCA Requirement AML System Enhancement Right Approach For FATCA Compliance Indicia Rules Only Specific fields mapped Pre-Configured rules, code-less rules are defined for all electronic searchable data and can be changed and managed Agility of creating new rules None Rules Engine with Agile interface for creation and modification of rules Account Aggregation Will be built in as a check A part of seamless rule engine Remediation Third Party application or coded small in-flexible process Flexible Case Management solution to accommodate remediation period for different customers Communication with customer To be handled outside of solution Case Management and Correspondence Module with strict audit logs and ready-to-use templates FATCA – The Right Approach
    7. 7. FATCA Requirement AML System Enhancement Right Approach For FATCA Compliance Auditing Framework No unified approach Comprehensive FATCA specific Audit Logs Document management System None DMS Module integral part of solution Recalcitrant Customer New module to be built Pre-configured in solution and IGA specific policies can be configured easily Evolve with Regulation Code to be changed and modules to be installed Agile interface with almost no coding required for further Regulatory Changes Manage other country FATCA regulations (UK, Germany, France etc.) Further modules must be created Configurable. Same infrastructure can be used to configure future changes FATCA – The Right Approach
    8. 8. Newgen FATCA Consultative Solution Approach 1: Ability to record/maintain and report account history for suspect/remediation and recalcitrant customers as audit file. 2: Create a e-file of all documents in the case file for easy archival/search/acce ss and collaboration for customers documents, Audit and Document Management 1: Annual US account reporting by participating FFI’s. 2: Validity of W Forms 3: Operational/Inv estigative and Transactional reporting for FATCA lifecycle management. Reporting 1: Follow-up on accounts awaiting data/document. 2: Automated escalations/aler ts and exception management. 3: Electronic Forms. 4: Investigations and closure of case. Workflow driven Case Management 1: Individual and Institutional 2: New Accounts 3: Existing Accounts 4: Aggregation Products 5: Threshold and Indicia checks. Account Identification and Classification 1: Develop Integration Approach 2: Pull data from Customer Database 3: Normalize and Clean Data 4: Aggregate Customer records and balances Acquire Customer Data 1: Conduct Gap Analysis 2: Create Project Plan Plan and Scope Initiation Classification Remediation Decisioning Archival
    9. 9. • Management of Customer Data • Quality of Current Customer Data • Identification of FATCA Reportable customers • Unpreparedness of Technology • Unpredictability of Regulation • Keeping up with Future sons and daughters of FATCA Operational Challenges of Implementing FATCA
    10. 10. Heterogeneous Source I/P Systems (Core) Deposit (Retail), Capital Markets, Trust, Wealth, Investment, Insurance Systems etc. Multiple entities with multiple core applications Feed file from all core systems Multiple file formats with varying data structures Unique identifier & secondary identifier Data Modeling & Transformation Field level mapping for all feed files Field wise data conversion of all feed files in a uniform structure Data type, length, mandatory & format validations CIF & Account records linkages and balance aggregation across feed files Normalization & Cleansing Normalize for homogeneous representation (e.g. KYC data from all systems represented uniformly) CIF level & Account level data mapping (e.g. addresses stored at both levels) Cleansing activity for ambiguous data elements (e.g. free text fields) Exception management for missing data elements Data Processing Process rule(s) on applicable sets of data from all feed files Remediation case management for success Identified indicia association at field level with conforming, resolving & waiver documentation requirement Exception case management for failures (with view to RM’s / compliance users) Reconciliation dashboard with drill down Data Input, Modeling, Transformation & Processing
    11. 11. Newgen FATCA Solution Suite United States Financial Institutions Foreign Financial Institutions Legacy Systems KYC Electronic Documents Data Warehouse USIndicia ChangeInStatus EntityLegalStatus Check Points Registration and Segregation Master Folder Rules driven Due Diligence Case Validation Entity Analysis Exempt Due Diligence and Audit Documentation Due Diligence Decision and Reporting Auto- Resolve Report to Tax Electronic Form W-8 W-9 Know Your Customer System Monitoring and Control WHT Reporting Case Management Document Management Communication Management Real Time Data Validation Change in Status & Periodic Review Integration IRS form instructions
    12. 12. 1. FATCA Readiness Surveys 2. Gap Analysis and Mapping of Data with Pre-Configured Rules 3. Extract data through Standard templates 4. Test-Run FATCA Solution 5. Implementation 6. User Approval 7. Compliance Sign Off 8. Training Eight Step Newgen FATCA Program
    13. 13. 1. FATCA is complex, ambiguous and instable 2. It will add Time and Cost. 3. It will require technology and evaluation of existing processes 4. Cursory analysis of customers is not enough 5. It will require program governance and ownership 6. Customer Relationships will be impacted 7. FATCA needs more than a quick fix 8. You will need an experienced implementation partner Eight Things to Keep in Mind when Planning for FATCA
    14. 14. • Completeness and Readiness of a Future Ready Solution. Have deep domain expertise in FATCA regulations, reduces your risk to re-invent and go with the best practices. • Reduced risk through best practice templates and on-time implementation. • Significantly lower cost of ownership and resource tie-up with user empowered training program • Much lower costs for the solution to adapt to new requirements with the configurable BPM framework • Lower TCO driven by 60 day roadmap • New age technology enables ease of integration with multiple systems • Extensibility of the solution to other valuable process automation initiatives. Been there, Done it, Proven results
    15. 15. Customer Case Study • Four of the Largest Caribbean Banks • Over 20+ live cases in the final stages Challenges • Complicated On-Boarding processes • Identification of FATCA Eligible individuals • Non-uniform and Isolated, systems and manual processes • Manage complex customer relationships • Adapting to changing market dynamic Benefits • Pre-configured Solution Accelerator reduces implementation timeline significantly • Uniform customer onboarding & KYC processes • Centralized & Decentralized FATCA compliance control & audit • Agility in Processes, specific to privacy islands like Bahamas • Extensive audit trails ensure constant monitoring • Flexible and configurable solution provide easy change management • Alerts and notifications for monitoring all cases • Real-time Automatic reporting and dashboards
    16. 16. Parameters of Project Success Complete Solution Complete and Seamlessly Integrated Solution Onboarding – FATCA Rules Engine – Case Management – Reporting – CMS Domain Expertise Best Practice Process templates for key FATCA Rule-Sets and domain consultants with knowledge pool of regulatory framework. Delivery Expertise Newgen has a dedicated implementation team of consultants trained on Newgen BPM, besides a pool of trained partners in various regions The Winning Risk-Free Equation
    17. 17. • Software Products in Business Process Management, Enterprise Content Management , Case Management & Customer Communication Management • Global footprint with 1100+ ECM, BPM and Case Management installations in 50 countries across Verticals including Banking, Financial Services, Insurance, Shared Service Center and Business Process Outsourcing, Government, Healthcare … • Credited with world’s largest implementations • Employee strength 1300+ • Innovative culture, Dedicated R&D centre, 40 patents • Certified for ISO 9001:2008, ISO 27001:2005 and CMMI Level3 Newgen Overview – Company Snapshot Investors Offices Singapore USA • Florida • Washington DC Canada UK UAE IndiaSubsidiaries
    18. 18. 2013 Impact Report 2013 ECM Wave 2013 Global Software Leaders Report 2011 Market Share Report 2014 Critical capabilities in case management report 2013 CCM MQ 2013,2012, 2011,2010,2009 ECM MQ Report 2014 iBPMS MQ participation, 2012 BPMS Market Update Report, 2010 BPM MQ 2011 Retail Loan Origination Vendor Landscape Report Good Condition and Low Risk Flexible and cost effective Emerging market’s top 100 software vendors No 1 in India Content Management Market Top 3 value for money2011 BPM Decision Matrix Industry Recognition Very Large Installations Comprehensive Case Management2012 ECM vendor evaluation Report
    19. 19. Our Global Customer Relationships Banking & Finance Insurance BPO & Shared Services Government
    20. 20. Singapore Star Shipping RTBA Customers in APAC