The Importance of Data Quality to Compliance with the Dodd-Frank Act William Henley Senior Vice President, Regulation

Transcription

1 The Importance of Data Quality to Compliance with the Dodd-Frank Act William Henley Senior Vice President, Regulation

2 Data Governance and Quality Why the focus now? Has always been an important pre-requisite for making financial services risk management and decision-making. Importance heightened in recent years due to the financial reform efforts to better manage systemic risk and the increasing interdependence of global markets.

3 Dodd-Frank Wall Street Reform and Consumer Protection Act H.R titles 878 pages

4 The Dodd-Frank Wall Street Reform & Consumer Protection Act H.R The future of compliance Regulatory Agency New Regulation* One-Time Study/Report Periodic Reports Bureau CFTC Council FDIC FRB FTC GAO OCC OFR SEC Treasury Total** *Estimate only includes H.R s references to explicit rulemakings in the bill, and thus likely represents a significant underestimate. **Total count eliminates double counting for joint rulemakings. Credit: Davis Polk

5 Office of Financial Research Title 1 Financial Stability Purpose To support the Council in fulfilling its purposes and duties. Duties 1. collecting data on behalf of the Council, and providing such data to the Council and member agencies; 2. standardizing the types and formats of data reported and collected; 3. performing applied research and essential long-term research; 4. developing tools for risk measurement and monitoring; 5. performing other related services; 6. making the results of the activities of the Office available to financial regulatory agencies; and 7. assisting such member agencies in determining the types and formats of data authorized by this Act to be collected by such member agencies.

6 Office of Financial Research (Cont d) The Director may require from a financial company, by subpoena, the production of the data requested under subsection (a)(1) and section 154(b)(1), but only upon a written finding by the Director that (A) such data is required to carry out the functions described under this subtitle; and (B) the Office has coordinated with the relevant primary financial regulatory agency, as required under section 154(b)(1)(B)(ii)

7 The True Cost of Data Achieving Defensible Disposal 1. Systematically link the business processes in legal, record information management and IT to provide structural and automated collaboration and transparency with systematic workflow. 2. Modernize the records management program so it provides reliable, actionable information procedures to IT managers. 3. Treat legal holds as an enterprise process rather than a legal department task. 4. Ensure IT can determine, using its terms and without interpretation, who and what is on hold, what is of value and what is subject to regulatory obligation.

8 What we are doing Survey Gain a better understanding of the state of data governance and data quality control across our industry Developing best practices for Data Quality 100% automated data accuracy checks for on-going operational processes not practical Define best practice statistical sampling methodology for data quality accuracy testing that provides statistically robust and reliable results Support to Financial Stability Industry Council (FSIC) Includes Developing General Principles to guide our position on produced data governance and quality standards Support to the Financial Services Roundtable FSOC and Prudential Standards working group Includes participating in SIFMA-led Legal Entity Identifier (LEI) project

9 What we are doing (Cont d) 1. Financial Stability Oversight Council Working Group 2. Enhanced Prudential Standards Working Group 3. Bank and Bank Holding Companies Working Group 4. Resolution Authority Working Group 5. Consumer Protection Bureau Working Group 6. Debit Card/Interchange Fees Working Group 7. Insurance Working Group 8. Volcker Working Group 9. Derivatives Working Group 10. Swaps Working Group 11. Credit Rating Agencies Working Group 12. Asset Backed Securities Working Group 13. Retail Securities Issues Working Group 14. Corporate Governance Working Group 15. Housing Related Issues Working Group 16. Payment, Clearing, and Settlement Working Group 17. Privacy and Data Security Working Group

10 Privacy and Data Security Working Group Rulemaking Principles 1. Perspective. 2. Issue Coverage. 3. Strength of Response. 4. Regulatory Impact. 5. Agency Coordination. 6. Rulemaking Process. 7. Rulemaking Transparency. 8. Neutrality of Technology.

11 Roundtable Members AEGON USA, Inc. Affiliated Managers Group, Inc. Allianz Life Insurance Company of North America Allied Capital Corporation The Allstate Corporation Ally Financial Inc. American Honda Finance Corporation Ameriprise Financial, Inc. Associated Banc-Corp Assurant, Inc. Aviva USA AXA Financial, Inc. BancorpSouth, Inc. BancWest Corporation Bank of America Corporation Bank of Hawaii Corporation Barclays Capital, Inc. BB&T Corporation BBVA Compass BlackRock, Inc. BNY Mellon Corporation Brown & Brown Insurance Capital One Financial Corporation Caterpillar Financial Services Corporation The Charles Schwab Corporation The Chubb Corporation CIT

12 Roundtable Members, cont. Citigroup Inc. City National Corporation Comerica Incorporated Commerce Bancshares, Inc. Discover Financial Services E*TRADE Financial Corporation Edward Jones Fidelity Investments Fifth Third Bancorp First Commonwealth Financial Corporation First Horizon National Corporation Ford Motor Credit Company Fulton Financial Corporation General Electric Company Genworth Financial Hanover Insurance Group Inc. Harris Bankcorp, Inc. The Hartford Financial Services Group HSBC North America Holdings, Inc. Huntington Bancshares Incorporated ING John Deere Credit Company John Hancock Financial Services JPMorgan Chase & Co. KeyCorp Legg Mason, Inc. Liberty Mutual Holding Company Lincoln National Corporation LPL Financial

13 Roundtable Members, cont. M&T Bank Corporation Marshall & Ilsley Corporation MasterCard Worldwide Mutual of Omaha Insurance Company The Nasdaq OMX Group, Inc Nationwide New York Life Insurance Company Northern Trust Corporation Northwestern Mutual Life Insurance Company People s United Bank The PMI Group, Inc. The PNC Financial Services Group, Inc. Popular, Inc. Principal Financial Group The Private Bank Protective Life Corporation Prudential Financial, Inc. Raymond James Financial, Inc. RBC Bank, USA RBS Americas Regions Financial Corporation RenaissanceRe Holdings, Ltd. SLM Corporation (Sallie Mae) Sovereign Bancorp State Farm Insurance Companies State Street Corporation

14 Roundtable Members, cont. SunTrust Banks, Inc. Swiss Reinsurance America Corporation Synovus TD Bank Toyota Financial Services Trustmark Corporation TSYS UBS UnionBanCal Corporation United Bankshares, Inc. Unum U.S. Bancorp Visa, Inc. Webster Financial Corporation Wells Fargo & Company Western & Southern Financial Group Whitney Holding Corporation Zions Bancorporation

15 Financial Affiliate Members American Bankers Association (ABA) Canadian Bankers Association (CBA) Canadian Payments Association (CPA) Center for Information Policy Leadership (CIPL) The Clearing House Credit Union National Association (CUNA) The Depository Trust & Clearing Corporation (DTCC) Early Warning Services MassMutual Financial Group University Bank USAA

16 Industry Affiliate Members 41st Parameter ActivIdentity AuthenWare Dorado Corporation Federal Reserve Bank of Boston IdentaZone International Financial Cryptography Association Microsoft PayPal (an ebay Company) Silver Tail Systems U.S. Social Security Administration TASCET VeriSign Xterprise