BSA-AML Examiner School eBook

Internal Use Only

BaaS – Banking as a Service BaaS partnerships differ from traditional vendor relationships in a variety of ways, notably in that they can present substantially higher degrees of risk. Accordingly, fintech partner oversight will form the core of the Bank’s future Third Party Risk Managment program. The FI should develop robust governing documentation to support the program. In particular, policy and program documents relating to Bank’s fintech partner oversight program should clearly address: • Roles and responsibilities • Reporting lines (board oversight and governance) • Testing and ongoing monitoring • Risk assessments • Partner due diligence and onboarding • Contractual safeguards • Contingency plans • Internal and external audits

Internal Use Only

AI & Machine Learning Technological advances in AML monitoring systems • AI, Machine Learning, other forms

• AML Software • Fintech Partner • Fintech Customer • BSA Officer responsibility • Trends • Discussion with examiners

STATE OF CALIFORNIA Department of Financial Protection and Innovation GOVERNOR Gavin Newsom · COMMISSIONER Clothilde V.Hewlett

The information discussed today does not represent the direct views or opinions of DFPI, but rather the examiner’s interpretation and opinion.