In the world of third-party risk management, organizations need to navigate a complex and expanding web of guidance, standards and regulations. Here, you can explore an overview of major industry standards and regulations that can help you ensure third-party compliance and build a more resilient business.
Regulators have made clear that third parties should attest to and align to your compliance, ethics, and risk management standards and obligations. Aravo enables customers to easily capture, update, manage and retain third party attestations and certifications with these regulations and other ethics and compliance standards.
Issued on August 27, 2021, “SR 21-15 / CA 21-11: Guide for Community Banking Organizations Conducting Due Diligence on Financial Technology Companies” is a resource developed by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency. This guide is intended for banking organizations with $10 billion or less in consolidated assets supervised by the Federal Reserve.
“Understanding a fintech company’s qualifications and strategic direction will help a community bank assess the fintech company’s ability to meet the community bank’s expectations and support a community bank’s objectives.”
“A community bank may evaluate a fintech company’s ability to continue operations through a disruption. Depending on the activity, a community bank may look to the fintech company’s processes to identify, respond to, and protect itself and customers from threats and potential failures, as well as recover and learn from disruptive events.”
This guidance issued by the Federal Reserve in 2023 emphasizes that the scope and degree of due diligence should be commensurate with the level of risk and complexity of the third-party relationship.
“A banking organization’s use of third parties does not diminish its responsibility to meet these requirements to the same extent as if its activities were performed by the banking organization in-house.”
“For certain relationships, clearly defined performance measures can assist a banking organization in evaluating the performance of a third party. In particular, a service-level agreement between the banking organization and the third party can help specify the measures surrounding the expectations and responsibilities for both parties.”
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