VIDEO: Goal of a Compliance Management System
In this Compliance Clip (video), Adam discusses the importance of a well designed Compliance Management System (CMS) and explains what the goal should be for a CMS. Maybe even more importantly, Adam explains what he considers a key element needed to be able to have an effective CMS. The video concludes with an explanation about how our premium memberships can assist financial institutions in implementing and managing their Compliance Management Systems.
More information on our Premium Memberships can be found at www.compliancecohort.com/premium-membership.
Video Transcript
The following is a transcript of this video.
This Compliance Clip is going to talk about compliance management systems or CMS. This is a topic that's near and dear to my heart because as a compliance professional, I understand the importance of having an effective compliance management system in a financial institution. The bottom line behind a compliance management system is this is your structure, your internal program on how you understand regulations and effectively apply them in your organization. That's really the bottom line of a compliance management system.
I want to spend a few minutes just to talk about the compliance management system requirements from the regulator’s perspective, and then talk about how we here at the Compliance Cohort could help you consensually in understanding and implementing your compliance management system. When we look at what the regulators say about a compliance management system, they typically tell us that there are three core elements. The first element of course is board and management oversight. Regulators say that your board is ultimately responsible for your compliance to function. So what the board does, of course, is designate you or somebody in your organization as a compliance officer who's responsible for implementing the program. Board and management have to oversee this from the perspective of overseeing your chief compliance officer in your organization, who then oversees other people who oversee other things. That's the organizational piece of a compliance management system.
Within a CMS, the second element is a compliance program, and this includes a couple of sub-pieces like policies and procedures; and training; then also a piece called monitoring and/or audit; as well as consumer complaint response. This is your program that is of your operations. The first bullet point is really our organizational structure while the second bullet point is really the operations of our compliance program within our organization. So policies and procedures, that makes a lot of sense, this is what we're doing day to day. This is what we're allowed to do, not allowed to do, day-to-day operations. Training - it's how we communicate those requirements to our staff. It's how our compliance professionals understand the rules and regulations on what your organization's responsible to do from the regulatory perspective and then how you apply that in your organization. Then monitoring is making sure that you're doing what you're supposed to be doing. And the complaint response is monitoring for complaints because you're essentially monitoring for potential issues that you may have relating to consumer compliance and violations of regulations. That's the whole complaint response piece.
The third element of a CMS relates to service provider oversight. When you have service providers, you also have to make sure that they're with the rules and regulations.
So these are the three elements that generally come from the regulators. They don't all break it down this way, but this is how I like to explain it. But the regulators go above and beyond, and they say that there's certain things that a CMS is supposed to do. At the end of the day, what is your compliance management system supposed to accomplish? Well, they say that a compliance management system is how your institution establishes its compliance responsibilities. It's how it communicates those responsibilities to employees. It's how you ensure those responsibilities are incorporated into your business processes. It's how you review operations to ensure responsibilities are carried out and legal requirements are met, and it's how you take corrective action. This here is what is a compliance management system, and really the end result, the outcome of your CMS. This is what you're supposed to be doing.
The question I always like to ask is how in the world do you get to this point? Well, in order to get to these results, you have to have an understanding of the rules and regulations that apply to your organization. That's the bottom line. You have to know what those rules are, so that you can then make sure that your organization is applying those rules. And in your CMS, you apply those and then make sure that people are doing what they're supposed to be doing and monitoring for issues. So at the end of the day, the core piece is understanding those rules and regulations.
This is why I'm passionate about this. The mission of the Compliance Cohort is to help explain compliance rules and regulations in simple and easy to understand terms and hopefully in a fun and more exciting way than some of the boring webinars and seminars that are out there. So this is near and dear to my heart because it is my goal to help you, as a compliance person or somebody who needs to understand rules and regulations, for your job function. It's my goal to help you understand that in the most simple way possible.
Now, I will tell you the rules are complex. They're challenging and sometimes they're very difficult even for me, who's been doing this for a long time and really geeks out on these rules. But it's my goal at the end of the day, to make them as simple as possible for you. One of the things I wanted to share with you is that we do have premium memberships and one of the best ways that we're able to provide those rules and regulations to our members and to those of you that watch our videos is through our premium memberships. Our premium memberships are the best value that we offer. We offer individual classes for sale. We have free compliance clips, but you have to sift through them to find things that apply, and we don't cover every single topic. We don't do deep dives, our compliance clips are three to five minute videos. We have occasional articles here and there. So there's a lot of resources for free on our site, but what we've tried to do in our premium memberships is package them in a way that really provides a ton of information to you, and also provides that information at the best value possible. So these are bundled packages that provide a great value. We have three membership options. We have Premium Pro, Premium Gold, and Premium Silver. Based on what you're looking for, we have a full all-access pass, which is our Premium Pro. If you're a Premium Pro member, you have access to everything in our store and everything we release. Premium Silver just has a basic level of information.
In our premium memberships, we offer a number of things. Every membership, all three, get a Compliance Management System class. What I just talked about here for a couple of minutes, we take a deep dive. I spent an hour and a half in the class, our Compliance Management Systems that comes with all of our premium memberships, and this is something that I'm passionate about, but I spent about an hour and a half talking about all of the elements that you need to have to effectively run your organization through your compliance management system, at least from the consumer protection piece.
Now, our premium memberships also include access to our quarterly compliance updates. Our quarterly compliance updates are exactly what you think they are. Each quarter, we talk about all of the regulatory activity that applies to consumer protection and regulatory compliance, and talk about how it could apply to your organization. These programs are not just 15 minutes. They are a deep dive covering everything that was said, everything that was uncovered, everything that, at least that I've found, I think is important to share with our audience. And so these programs run two, two and a half, three, three and a half hours depending on the quarter. And they really take a deep dive as to what's going on. It's a great way for our members to understand the hot topics and regulatory compliance because we're talking about all the changes as they occur each quarter. It really is a deep dive program into regulatory compliance with the goal being that you’re understanding what's going on, so you can apply it to your organization.
Then we do have additional training that comes with our premium memberships. At least, in our Premium Gold, you get access to two additional classes in our store. The Premium Pro, as I said before, is our all-access pass. It makes a great value if you're somebody new to compliance and you're trying to understand rules and regulations, that's a great way to get caught up to date very quickly because you can watch those programs as many times as you want during your year membership. So it is a really good value.
We also have something called Premium Perks that we started adding here in 2022, where I provide things like executive summaries, cheat sheets, other tools, and resources, maybe something our members request, and we're providing that to our premium members as additional tools to assist compliance professionals.
We have a lot of options available to assist you in your compliance management systems, and one of the best ways that we offer that I believe is through our premium memberships. I'm talking about this now because our enrollment for premium memberships is open at the time we released this video, or they're going to be open very soon here in the Summer of 2022. We only open enrollment for our premium memberships twice a year - in the very beginning of the year and then in the very beginning of the third quarter of each year. So enrollment is limited and you can get in one of those cohorts, we call it the January Cohort or the July Cohort. This of course would be the July Cohort that we're presenting in this video.
If that's something you're interested in, take a look at our store at compliancecohort.com/store where you can see all of our programs. You can see our premium memberships at compliancecohort.com/premium-membership, which of course you can find through our store, if you just want to go there and find the premium membership. I encourage you to take a look at those. If you're really wanting to build your compliance management system, the number one thing you'd have to do is understand the rules and regulations so that you can apply those to your organization.
Well, I hope you found this Compliance Clip beneficial, at least the first part where we talked about the elements of the compliance management system. I don't like to talk about our products and services too much in these compliance clips, but with a premium membership only opening twice a year, I think it's important to mention that to those of you who really want to take that deep dive. So understand that that's available for you. That's all I have for you today. Thank you so much for sticking with me through that. Until next time.