2020 Journal of Community Bank Studies

FIRST PLACE: Mississippi State University

they have that month, and why they might have occurred. CNB’s compliance manager, Ms. Kelly Menard, believes that information is key when trying to better assess the bank’s risk. Ms. Menard assesses several key components such as the type of loan, individual characteristics, sales, number of visits, and type of transaction to name a few. CNB gathers information from compliance software, Verafin, that efficiently and quickly outputs data to the company. CNB then looks for any trends in the data and monitors these trends for further analysis. After the data is analyzed, CNB reports the SARs and Customer Transaction Reports (CTRs), and tries to find out why they happened and what can be done in the future to prevent them. Verafin notifies CNB of possible suspicious activity and can be programmed to look for certain things. If a SAR is filed, Verafin can notify other banks of the activity as further preventive measures. Verafin uses machine learning, which can help streamline the process in further months by providing more accurate reports on suspicious activity. Through an experienced staff, CNB has been able to fine- tune the software’s parameters to limit the number of false alerts. Prior to Verafin, CNB could have up to 1,000 alerts about suspicious activity, but that number is down to about 300 alerts per month. Citizens National Bank takes BSA/AML compliance very seriously and has three dedicated employees to its compliance, each with a different focus. With the help of Verafin, they can gather and assess data very quickly and easily. Employees within their BSA

By constantly monitoring activity throughout the bank, CNB ensures that all its employees are complying with BSA/AML regulations and that all suspicious activity is being reported.

department have covered many roles over time with the goal to improve timeliness so CNB can quickly recognize suspicious activity. This has made all their monthly compliance tasks much easier and has greatly shrunk the time on assessing possible suspicious activity. All full-time employees at CNB are required to take annual webinars and classes to stay up to date with their BSA/AML compliance training. New hires must also attend these webinars and classes and must take a test to ensure their readiness to locate suspicious activity. By constantly monitoring activity throughout the bank, CNB ensures that all its employees are complying with BSA/AML regulations and that all suspicious activity is being reported. CNB’s experienced compliance staff has made switching to a new software easy, but to ensure BSA compliance in employees, CNB also relies on internal and external audits.

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