Basel Committee on Banking Supervision Outsourcing in Financial Services (issued 2005)

“Outsourcing has the potential to transfer risk, management and compliance to third-parties who may not be regulated, and who may operate offshore.”

“Regulated entities can mitigate these risks by taking steps (as discussed in the principles) to: draw up comprehensive and clear outsourcing policies, establish effective risk management programmes, require contingency planning by the outsourcing firm, negotiate appropriate outsourcing contracts, and analyse the financial and infrastructure resources of the service provider.”

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