Leonard Steinmetz, senior manager of the Global Anti-Money Laundering Practice of Deloitte’s financial advisory services, says there are three key areas that must be covered in a software solution contract:

1. Platform compatibility - Make sure the solution fits your environment.
2. Technology integration - Will it fit our current architecture easily?
3. Support staff - Does the vendor have a dedicated support staff? Will they support updates to the software or only earlier versions?

During the technology panel today, the message was "first, take a look at what you have in house, then go out shopping".

John Pyrik said that before buying any solutions out there, institutions should take into account the resources that they already have handy, as over-the-counter software, that you can utilize for your due diligence.

But another important message was definitely what I would call the oil for the car. If you don't put oil in your car, it won't work. The same idea applies to data. If your data integrity is not good, what comes up won't be good either. You can work with the best technology and software of all, but they need their fuel to work, and it has to be clean.

So before working on technology, go ahead an take a look at home: evaluate your software and your data before heading out to shop.

If your institution doesn't have the ability to monitor high-risk customers it's unlikely that you have an effective suspicious activity reporting program, said David Caruso, of Dominion Advisory Group in Virginia, in the Seven Deadly (AML) Sins panel this morning. Identifying these customers, he said, is a "predicate necessary to have a SAR program that's meaningful.

• Start by deciding how you'll determine which customers are high risk (by who they are, where they are from, and what they do)
• Think thoroughly about what drives your identification of high risk customers
• This should drive your SAR program

Remember 90 percent of recent enforcement actions mention organizations not filing SARs on high-risk customers.

Said by a speaker during SAR Progran Panel:

"Being up here is like winning an Oscar! A lot of people, a beautiful facility, and only five minutes to speak."

-Andrew Zembles, Director, Corporate Compliance, Pacific Life Insurance Company, Newport Beach, California

We've been hearing for some time that enforcement actions issued by regulators are guides for banks to learn what not to do wrong at their institutions, but they're not necessarily instructions for what every bank should do.

"Just because we've instructed a bank to take an action doesn't mean that that's an action every bank should take," said Anne Jaedicke, Deputy Comptroller of Compliance for the U.S. Office of the Comptroller of the Currency, at the Seven Deadly (AML) Sins panel.

The U.S. Financial Crimes Enforcement Network (FinCEN) has prepaid cards on its mind. William Langford, FinCEN's associate director of regulatory policy and programs, said at the conference's opening panel that his agency plans to issue an advanced notice of proposed rulemaking asking for industry input regarding these products.

"We want to push this forward to update the MSB [money services business] regulation," said Langford.

Stored value products are currently included in the Bank Secrecy Act definition of money services business.

Langford also shared some numbers on suspicious activity reports (SARs) dealing with prepaids:

471 SARs filed referenced prepaid cards
137 were filed by banks
331 were filed by MSBs

Interestingly, the first SAR filed dealing with these cards was filed in May 1998.

We're getting closer... AGM employees rose early (before 5AM!!!!) this morning to prepare the conference registration area. Now it's 6:24 and registration has been open for almost half an hour but the wave of more than 1,000 people that we're all getting ready for hasn't began to roll in (looks like we don't have many early risers). Tune in later for pictures of the sky as seen from the registration area -- and for conference news, of course.