Nigel's Eyes

20220106 Twelfth Night, and all that stuff.

In Russia, for example, there is no Santa Claus but today, 6th January, there is Father Frost who, except that he wears blue, is a Santa Clone. In Christian-based societies, today is Twelfth Night and that's the day that all the festive decorations must be taken down.

For us, it's the day we launch the first e-learning package of 2022 for risk and compliance teams. Details are here. Individuals can buy it, too.

Following the package will take users to full certification for the Certificate in Financial Crime Risk and Compliance within one year. That's the advert over...

Happy New Year for 2020 and for those that celebrate any one of a number of other New Years around this time, Happy New Year to you, too.

We wake this morning to the news that Hong Kong has reinstated several strict measures to try to prevent the spread of Coronavirus including blocking flights from 8 countries, amongst them the UK and the Philippines, countries with which there is considerable traffic.

In the Philippines, the restrictions that have been present in Manila are to be extended outside the capital. In France, restrictions on travellers from the UK are inconsistent and, it seems, inconsistently applied.

In the UK, businesses have been told to plan for as much as a 25% absentee rate as the Omicron variant lifts the number of infected persons to almost 200,000 per day, the vast majority of whom are required to isolate at home - and as close contacts so are their families.

In Malaysia, pilgrims returning from Saudi Arabia have, in a worryingly high proportion of their number, carried home the virus. Some have broken quarantine by going out or having visitors. The result is that pilgrimages have been suspended, those returning were first required to have an electronic tag and, later, pilgrims have been rejected for home quarantine so that they can be properly policed.

All of this is in the face of pitched battles of words between those who object to safety measures, anti-vaccination campaigners and those who say "just do as you are told so we can get through this as quickly as possible."

It is here that we find the risk and compliance lessons - and it is here that we learn about human nature.

We, as humans, have remarkable autonomy. Our ability to function independently is a product of our genetics. It is also a product of our culture. There is a conflict between religions, or sub-religions, that seek to exercise control and those which say "God gave us free will."

A compliance culture is easier to instil in societies where religion dominates the way of life.

But even so, the fundamental independence, even resistance to control, finds ways of expressing itself. Often, the ways are illegal.

They may be anything from the use of drugs to riding a motorbike through a red light or on a pavement. Or they may be shoplifting to robbing a chemists' shop or corner grocer's.

And for those with the opportunity, it might be committing a financial crime.

In Singapore, last week a bank officer was convicted of an offence that is suspended in the gaps between several of those: he had access to the bank's vault and when he went in for legitimate reasons, he took with him pieces of paper cut to the same size as bank-notes. He would swap his paper for real notes in bundles in the vault. He managed to walk out - and gamble away - some SGD1.6 million before his actions were discovered.

It's a remarkably simple, low tech, crime that demonstrates that, while everyone is focussed on the latest, greatest and most social-media forms of offence, one must not lose sight of the basics.

It is important that all those engaged in financial crime risk and compliance understand this: nothing happens in a vacuum. To identify risks before they become threats requires a far wider view than is commonly applied. Increasingly, we are seeing risk perimeters defined not by a full understanding of the business but by algorithms supplied by technology companies which focus on standardised assumptions. To broaden those assumptions is expensive.

That's where human experience and understanding comes in. It's why your first call, before calling a tech company, should be someone like me. Complete the contact form at Vortex to find out how I can help you.