Don’t get left behind: The benefits of automating your FICA process

fica compliance
15 May 2023

When discussing FICA compliance, the number one frustration is that implementing procedures and requirements is labour intensive across the business. To solve this, many law firms are turning to software to assist with their regulatory compliance needs.

Some of the benefits of automation include:

1. Increase in productivity

The benefits of using an automated solution means that repetitive tasks get completed automatically and mundane tasks (like collecting and filing mountains of paperwork) are removed.

In terms of FICA compliance, an example of this is no longer having to manually request or send countless emails to collect and follow up on customers’ documentation for FICA purposes. Automated software enables you to load a customer with a specific entity type and takes care of emailing the customer to ask for the relevant forms. It will also send a follow up email when the incorrect or invalid documentation has been sent.

2. Standardise and enforce a single approach to ensure consistent policies and procedures

As a business grows, the task of ensuring everyone is consistently carrying out the correct procedure becomes more complex. The best software tools allow you to define, create and implement your policy and procedures according to your unique business needs.

According to the FIC Amendment Act, risk rating your customers, to ultimately determine the amount of due diligence to be done, is vital and should be consistently carried out whenever you onboard a customer. Having a configured system that is set up according to your business rules means that when onboarding a client you are able to enforce that each client is risk rated and thus onboarded consistently across your business, according to your rules.

3. Have easy oversight at the click of a button

Using a centralised software solution means that businesses are able to use dashboards to organise data, so more time can be spent on data interpretation.

4. Eliminate human error

Automation largely takes away the monotonous work and therefore enables staff to instead focus on decision making.

As per the FIC “Accountable institutions must be able to determine whether they have a sanctioned person or entity as a client or whether a prospective client is a sanctioned person or entity in order to determine their exposure to TFS-related obligations. This implies that accountable institutions which are likely to come into contact with sanctioned persons or entities are able to screen clients and prospective clients against the relevant sanctions lists. This should be done during the client take-on process as well as subsequently as and when the UNSC adopts new TFS measures or expands existing ones.”

If recent times are anything to go by, there are frequent changes made to sanctions lists, and finding lists with the most up to date names can be challenging. A further consequence of this is that it takes hours for staff members to manually screen and search every individual on various sanctions lists before onboarding them, so there have been solutions created to ensure shorter turnaround times, with higher levels of accuracy, leading to improved and enhanced processes. In other words, just one example is using a software solution to automate your sanction, DPEP and FPEP screening so that staff no longer have to spend hours searching sanctions lists. As an added bonus software solutions can largely reduce risk more as they have the ability to enable algorithms that skilfully handle variations in names and spelling ensuring that nothing slips through the cracks.

5. Keep up to date with the latest regulatory requirements

Software solutions are often built around the latest requirements, so the best providers will have an in-house compliance team that ensures that the software is up to date with compliance regulations, meaning that your business can now rely on your software provider to keep you up-to-date with the latest regulatory requirements.

See how automation can help reduce your admin burden and save hours in your day.

To find out how DocFox can automate your KYC process so you can make better informed decisions in a fraction of the time, request a demo.

See also:

(This article is provided for informational purposes only and not for the purpose of providing legal advice. For more information on the topic, please contact the author/s or the relevant provider.)
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