Posted by Brian Monroe -
The skinny:
- Dharm Patel’s career has been mainly focused on the challenges of better capturing, analyzing and wielding data, first to stop fraudsters and scammers and more recently, to buttress anti-money laundering compliance.
But after more than 16 years in the field – chiefly at credit reporting mainstay, Equifax, and for nearly a year as VP and - General Manager of Fraud and Financial Crime at Fiserv – spending so much time in the digital realm, he has also learned a valuable lesson of equal import in the real world.
- What is it? That the best technologies can’t live, learn and grow without training, encouraging and empowering the humans using them – a skillset borne out of studying human behavior and interactions that has grown in importance in recent years under the banner of “emotional intelligence.”
By Brian Monroe
bmonroe@acfcs.org
May 3, 2022
Dharm Patel’s career as a financial crime fighter has been mainly focused on the challenges of better capturing, analyzing and wielding data, first to stop fraudsters and scammers and more recently, to buttress anti-money laundering compliance.
But after more than 16 years in the field – chiefly at credit reporting mainstay, Equifax, and for nearly a year as VP and General Manager of Fraud and Financial Crime at multi-billion dollar financial services giant Fiserv – spending so much time in the digital realm, he has also learned a valuable lesson of equal import in the real world.
What is it?
That the best technology, algorithms and artificially-intelligence-infused systems are not truly alive without training, encouraging and inspiring the humans using them – a skillset that has grown in importance in recent years under the banner of “emotional intelligence.”
One of his core secrets to success has been learning to connect with teams around the globe and getting them to see that they are valued, appreciated and that their analysis, thoughtfulness and decisions have tangible ramifications in the broader fight against financial crime.
“Take time to understand your emotional intelligence and work on improving it,” Patel said. “Emotional intelligence will help in both your personal and business life.”
But what is emotional intelligence or, similar to IQ, your EQ?
Online, it is defined as the “capacity to be aware of, control, and express one’s emotions, and to handle interpersonal relationships judiciously and empathetically.”
In terms of the professional arena, having a high EQ can help rally and inspire teams toward a common goal.
Why?
Because kindness and support – in any sphere of human interaction – foster trust and caring, the foundation of fruitful and long-lasting relationships, friendships and loyalty.
That philosophy has taken on even greater importance as the fincrime compliance field has been buffeted by disruption in recent years, for good and ill.
Criminal groups, corrupt kleptocrats, fraud syndicates, terror groups and more have continued to be an agile, creative and resourceful group when it comes to scheming, scamming and spamming – and then monetizing and laundering those sullied assets through the fiat and crypto worlds.
For instance, cyber-enabled fraud – ransomware, business email compromise, phishing and related digital fusillades – has broken records and caused an interwoven surge in virtual value payouts.
This convergence of financial crime attack tactics has put more pressure on bank anti-money laundering (AML), fraud and cyber defense teams to respond in a similar coherent, cogent and unified fashion.
The result: many institutions are breaking down formerly siloed investigative units and cross-training previously disparate teams to understand each other’s duties, red flags and lessons learned.
These initiatives have helped departments communicate more quickly and effectively, preventing investigations from running in parallel and making it harder for organized attackers to game the system and skip between countercrime programs.
This is a trend Patel has seen on the ground while working with financial institutions to strengthen their teams, a regulatory focal point and client pain point.
“I have been impressed by the continued convergence of fraud and AML practices within our industry,” he said.
In quest to better align compliance duties, law enforcement needs: new rules require ‘effective’ programs
The issue of convergence and how to do it to create richer and more relevant intelligence for law enforcement was the subject of not one, but three industry conferences Patel attended in March.
“There was a heightened need for bringing fraud and AML practices together – either through organizational changes, implementing new technology or simply greater collaboration and sharing of information.”
One the positive side of the disruption spectrum, the U.S. in January of 2021 passed the Anti-Money Laundering Act (AMLA) of 2020, the most significant upgrade to the country’s fincrime framework since the 2001 U.S.A. Patriot Act.
The AMLA is a sweeping series of updates to expand public-private partnerships, crack open beneficial ownership vaults and, most significantly of all, shift the industry from fearing regulators to championing the needs of law enforcement.
The legislation is a marked shift away from regulatory process to crafting valuable and timely intelligence for federal investigators – guided by new National AML priorities that the U.S. Treasury’s Financial Crimes Enforcement (FinCEN) released in June.
To read ACFCS coverage of the AML Act, click here.
FinCEN’s stated AML priorities are:
- corruption;
- cybercrime, including relevant cybersecurity and virtual currency considerations;
- foreign and domestic terrorist financing;
- fraud;
- transnational criminal organization activity;
- drug trafficking organization activity;
- human trafficking and human smuggling; and
- proliferation financing
To read the full list of AML priorities and related interagency statements, click here.
The widely-watched and highly anticipated AML priorities were the first concrete update to implement the AMLA, though formal regulations and updates to the interagency AML exam manual have yet to be released.
Shifting focus from adequate to effective AML programs, laundering climes to predicate crimes
But just as Patel stated his longstanding mission is to preach on and deliver more effective compliance teams, individuals and technology, the concrete parameters of effectiveness for much of his career had yet to be defined – by governments, regulators or industry.
That changed on the day FinCEN released it’s AML priorities, when the Wolfsberg Group issued a decisive missive to detail how financial institutions can tangibly demonstrate effectiveness.
In short, the Wolfsberg metrics of effectiveness include:
- Are you compliant with local AML laws, cognizant of global standards?
- Are you producing highly useful information to law enforcement, guided by national AML priorities?
- Do you have a reasonable compliance program that reviews internal and external threats, gaps and vulnerabilities and adjusts based on rising or receding risks and law enforcement input?
To read the full statement by Wolfsberg Group, an influential alliance of more than a dozen of the world’s largest banks, including Citi, JPMorgan, Barclays, Credit Suisse and others, click here.
Taken together, these changes mean the fincrime compliance field is moving away from simply understanding and reporting on potential instances of general money laundering to uncovering and divining the illicit activities generating the tainted funds.
“AML has materially moved from being a regulatory requirement to being emotive where the industry wants to reduce predicate crimes,” Patel said.
“Fraud and Financial Crime changes rapidly and our ability to continue to solve our clients’ challenges necessitates our ability to evolve and adapt,” he said. “As this industry and our business continues to grow, it is important to develop good leaders who drive toward shared ownership and accountability.”
Patel was kind enough to share some of his insight in our latest ACFCS Member Spotlight:
Who inspires you?
Jurgen Klopp, Liverpool Football Club Manger. Klopp brings an entire organization, fan base and observers (e.g. media) on a journey through inspiration, dedication to a craft and delivering results.
What is one thing - industry-related or not - that you learned in the past month?
I have been impressed by the continued convergence of fraud and AML practices within our industry.
I had the benefit and privilege of attending three conferences in March, and in discussions with clients and listening to industry experts, there was a heightened need for bringing fraud and AML practices together – either through organizational changes, implementing new technology or simply greater collaboration and sharing of information.
What is something about you that not many people know?
My wife and I are both part of families spanning three countries over three generations.
Our respective parents were born in India, my wife and I were born in the United Kingdom, and our daughters were born here in the USA.
What do you do in your current role?
My career has predominantly been to develop and deliver data insight to solve client challenges.
In my current role we use innovative technology to develop and delivery data insights to help our clients manage Fraud and Financial Crime while minimizing customer friction for efficient and compliant money movement.
What does your career trajectory in financial crime look like?
I joined Fiserv in June of 2021 and so my focus is my current position.
What is the best advice you have ever received?
A business school professor advised me to treat a job like a business:
- Understand how your actions impact internal and external customers
- Make investment decisions like it is your own money
- Build trust
- Evolve your capabilities to stay competitive
What is the worst advice you have ever received?
I have been fortunate to be surrounded by good people and have benefitted from some fantastic mentors. It is possible I received bad advice along the way, but I do not believe I have acted on it.
What would you say are the most important attributes for someone in your position to succeed?
Making decisions, executing those decisions and empowering team members to do the same.
Fraud and Financial Crime changes rapidly and our ability to continue to solve our clients’ challenges necessitates our ability to evolve and adapt. As this industry and our business continue to grow, it is important to develop good leaders who drive toward shared ownership and accountability.
How has (compliance, investigations, etc.) changed and evolved during your career?
AML has materially moved from being a regulatory requirement to being emotive where the industry wants to reduce predicate crimes.
What do you see as the key financial crime challenges in your role or in the sector overall?
I see three key challenges:
- Historically fraud and AML have been separate practices. However, a good portion of financial crimes are enabled through accounts opened and used by fraudsters. Increasing collaboration across these practices will help with this challenge.
- The volume of useable data continues to increase, which is both a challenge and a benefit. Leveraging technology which utilizes explainable AI/ML allows for this data to be converted to actionable intelligence.
- Due to the “great resignation” having sufficient skilled resources to manage AML alerts and cases is an on-going challenge. But there are organizations who specialize in providing skilled resources that can help fill the gap.
What motivated you to become a financial crime professional?
I love the complexity related to 1. Fraud and Financial Crime, and 2. Data, Analysis and Technology.
My career has afforded me the ability to work with both.
Is there anything that surprised you in your current role?
No, the leadership who brought me into Fiserv did a great job of educating me on the role, the team and organization.
Why did you join ACFCS or gain the CFCS designation?
It is important to become as immersed in and knowledgeable about the financial crime industry as possible.
ACFCS seemed a natural fit for this.
What is the most rewarding part of your job?
I take tremendous pride in developing people and teams to be more effective and preparing them for taking on more responsibilities.
How did you get your first job in the field and what advice what you give other job seekers to land their first position in compliance?
I first started as an Analytics Consulting professional focusing on credit risk decisioning and then added fraud prevention initially focusing on understanding the data and how to make it actionable.
My advice would be to be somewhat pragmatic about your early career.
Find what you enjoy or a field that excites you and use opportunities, such as special projects, to learn about other career directions.
For professionals with 5-10 years of experience, what advice would you give them to help advance to senior management roles?
Take time to understand your emotional intelligence and work on improving it. Emotional intelligence will help in both your personal and business life.