1. THE CHALLENGE OF REGULATION AND COMPLIANCE
5 July 2012
Leas Bachatene – Vice President, Managing Director Asia Pacific
Thomson Reuters Governance Risk & Compliance

2. THE REGULATORY DELUGE
RULES OF BUSINESS ARE
BEING REWRITTEN
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3. REGULATORY ACTIVITY TRACKED 2010-2011
*Note: Tracked activity includes document changes, announcements, and enforcements by regulators.

4. WHAT WEALTH MANAGERS NEED TO KNOW
COMPLIANCE CHALLENGES
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5. THE CONSEQUENCES OF NON-COMPLIANCE
• Increased fines and enforcements
• Reputational damage with clients, prospects, and your market
• Imprisonment and loss of license
Fine/
Date Institution Agency Imprison Violation
ment
June UK & US
Barclays $ 453M Libor Rate Manipulation
28 Regulator
May
JP Morgan CFTC TBC Poor Corporate Governance
30
Raj Rajaratnam, head DOJ, SEC, $102.8M
Oct
of Galleon Group Manhattan 11 yrs Insider trading
2011
hedge fund DA prison
DOJ, Facilitated and concealed wire
Aug
Barclays PLC Manhattan $298M transfers to and from blacklisted
2010
DA countries

6. THE CONSEQUENCES OF NON-COMPLIANCE
• Increased fines and enforcements
• Reputational damage with clients, prospects, and your market
• Imprisonment and loss of license
Fine/
Date Institution Agency Imprison Violation
ment
Facilitated and concealed wire
May
Royal Bank of Scotland DOJ $500M transfers to and from blacklisted
2010
countries
“Improper payments” in a number
Feb
Daimler AG DOJ, SEC $200M of jurisdictions, including Africa,
2010
Asia, and Eastern Europe
DOJ,
Jan Falsifying wire transfers destined
Lloyds TSB Manhattan $350M
2009 for Sudan, Iran and Libya
DA

7. OVERVIEW ON COMPLIANCE CHALLENGES
• FATCA is what seems to be causing the banks the biggest challenge
• Regulators in Asia are getting a lot tougher about approving wealth
management products and looking at the miss-selling procedures in place
• Singapore’s brought in a new code of conduct for private bankers and
Hong Kong there are much tougher rules now for structured products
• In the less developed financial centres, there is an issue of regulatory
uncertainty and barriers for foreign banks.
• FCPA and UK Bribery Act
• Dodd Frank still a work in progress and still haven’t finalized drafting how the
rules will reach overseas. However, those rules and the other new rules on
derivative trading coming in across Europe and Asia mean that banks will
have a lot of operational work to do to connect all their trading systems up to
central clearing houses and trade repositories.

8. GOVERNANCE, RISK & COMPLIANCE
GRC
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9. CONNECTING THE GRC BUSINESS COMMUNITY
Connect business strategy, operations and business transactions
to the ever-changing regulatory environment, so firms can go fast
while managing risk.

10. A CONNECTED GRC STRATEGY
By connecting compliance, audit, risk and legal, organisations can make informed decisions and
accelerate their business while managing risk.

11. TECHNOLOGY SOLUTIONS
• Regulatory Tracker
• World-Check & Enhanced Due Diligence
• FATCA
• Transaction monitoring /email monitoring
• Compliance Manager
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12. TRACKER AND POLICY MANAGEMENT SOLUTIONS
– Dynamically link policies to the
underlying rulebooks
– Easily manage version and
hierarchy control
– Enable easy sharing through
intuitive workflow and update
distribution
– Evidence policy adoption
(through RecordKeeper)

13. SCREENING SOLUTIONS (NEW)
– Initial and on-going screening
against an unrivaled and
unique data set, built by our
own research team
– Ensure client and customer
identity with Electronic Identity
Verification
– Screen for potential risks with
Adverse Media searching
– Understand the risks
associated with Politically
Exposed Persons
– Gain a deeper understanding
of clients, suppliers & partners
in emerging markets
– Monitor transactions
– Screen vessels against
sanctions and enforcements

14. TRANSACTION MONITORING / EMAIL MONITORING
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15. TO DO MORE WITH LESS
COMPLIANCE AS A
COMPETITIVE ADVANTAGE
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16. So what are the three things you should do?
• People and expertise
• Culture is probably the most important aspect of
implementing GRC and the board and CEO needs to set
the tone at the top.
• The right expertise, and providing the right training is
critical. One of the most effective ways of improving
governance and compliance quickly is training employees
in the standards expected of them by the company –
• Companies have learned that their employees can be the
largest source of risk, they also learn that changing
employee behaviour is the best way of managing risk and
can be your first line of defence.
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17. So what are the three things you should do?
• Insist on “Better Information not More Information”
Our mission at Thomson Reuters is to provide better
information. Of those 15,000 regulatory updates that
Thomson Reuters track from 300 regulators around the
world every year (an average of 60 updates) a day, which
is the one that if missed could put your business at risk?
• Standardise processes and better controls around
your risks, prioritising where the largest risks are and
placing standard controls and checks in place – driving
growth whilst ensuring standards are maintained is the
primary goal of any GRC workflow and control tool
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18. 2012 SPECIAL REPORT – THE STATE OF REGULATORY REFORM
QUESTIONS
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