Quentin Downes

Quentin Downes

Seven training and development secrets for new staff in the financial sector

Training and development isn’t just important in the workplace - it’s vital; as much for the CEO as for an employee.

In fact, an organisation's capacity to grow and thrive is defined by how it approaches training and development. The benefits of equipping your employees with the skills and knowledge they need to do their job to the best of their ability are monumental - and this is especially true in the financial sector, where new regulations are constantly introduced and compliance is changing by the day. However, in the current climate, many organisations find financial crime training programmes too much hassle. They’re expensive to run, tricky to organise, and your staff have to take time out of their busy work schedules to take part. But the ROI of ongoing training and development is a no brainer. Not convinced? These training and development secrets might just make you change your mind…

Let’s look at the statistics
According to LinkedIn, 94% of employees would stay in a company longer if it invested in their career. However, as it stands, one in three people leave an organisation in the first year - so it’s absolutely essential to get your training and development, as well as your onboarding process, just right. PwC estimates that the cost of losing an employee in the first year can be up to three times the person's salary - a staggering loss of £42bn annually - so it’s worth investing in your employees.

The benefits of training and development
There are a number of benefits to running employee training and development programmes. Firstly, there’s improved employee performance due to an increased understanding of their role and responsibilities, especially in the ever-changing financial sector. Your employees will also be more confident and have improved job satisfaction, which will, in turn, lead to increased productivity. Regular training and development also ensures your employees feel valued. This not only means that they will work harder for you, but it also helps boost your brand image whilst helping with employee retention. Human resources are hands-down the most expensive asset a firm has - so it’s absolutely essential that your investment generates a positive return. Read on for the top secrets for successful financial crime crime training.

Financial crime training

1. Make sure you identify the needs
High-impact training and development programmes don’t just happen. Instead, they’re the result of a careful planning process that translates business objectives into a tailored training plan. It's all very well understanding the importance of training and development, but actually identifying your employees' needs is the crucial bit. Get it wrong and you could be wasting valuable time and money on training that may not actually be necessary. Most of the training programmes delivered to employees within the financial sector revolve around topics like sales training, anti-money laundering, budget management and cash flow management. However, you should also make sure you don’t forget managerial training skills such as supervisory skills, communication skills and conflict resolution.

As well as delivering training around financial regulations such as IBOR (Interbank Offered Rate), SFTR (Securities Financing Transaction Regulation), SM&CR (Senior Managers & Certification Regime) and MIiFID2 (The Markets in Financial Instruments Directive) there are other types of training that all employees need to know about, especially HR issues such as preventing discrimination or rules and regulations around GDPR and the handling of data. It’s about identifying your employees’ specific needs and individual skills gaps to make sure the training you offer is right for them. By identifying your company’s goals, rating the importance of each necessary skill and measuring your employees’ existing skills, you can start to pinpoint any gaps that might be holding them back.

2. Be sure to set clear expectations
In order to identify your training and development needs, you need to set clear expectations for each role within the business. If you're going to monitor performance effectively, you need to have a baseline from which to measure things against. Review new job descriptions and update existing ones in line with any changes to make sure you’re up to date with roles and responsibilities. By looking at where your employees are now, you can also identify where you want them to be in the future. How will their performance improve after the training? How will it prepare your staff to fulfil their roles and do their jobs effectively? By asking these questions at the beginning, you can define your objectives and set clear expectations about what you are hoping to achieve – which makes it easier to review your training further down the line.

3. Ask your employees
It might sound obvious, but if you want to deliver effective training and arm your employees with the knowledge they need to do their job better, you just need to ask them what they need! Use regular and focused employee evaluations to encourage honest and open feedback. This will create a helpful dialogue about career development and enable you to identify any specific training requirements for your employees. Regular one-to-ones or performance reviews are a great way to encourage open and honest communication. You could ask your employees to rate their job satisfaction and their personal performance as well as what could make it better. Also, ask managers for feedback on employees and compare these answers with employee self-evaluation to identify differences.

4. Keep up with regulations
It’s not just the competition that’s getting tougher in the financial industry, but also the regulatory requirements. Compliance training is one of the most important measures a financial services company can take to prevent compliance problems, so it’s essential to regularly review your training and development programme and make sure it is in line with current regulations and that your training material keeps up to date with the latest changes. Your training must reflect those latest expectations for performance and best practices.

5. Be open to different approaches
The effectiveness of your training and development programmes ultimately depends on how engaged and motivated your employees are. When planning your financial crime training programme, remember everyone is different and people will respond to different types of learning better. Some prefer face-to-face learning in a classroom, others prefer to learn online, some react well to group learning, whereas others prefer a one-to-one approach. If your employees can’t feel a connection with what they’re learning, it’s less likely that they’ll absorb and be able to recall the information later on. Some people learn better through hands-on methods, while others learn better independently. That’s why it’s important to provide a variety of ways for employees to learn and practice their skills, so you can find an engaging method that works for them.

Financial crime training

Elearning is popular in the financial sector due to the lower cost involved in online delivery as opposed to travelling required for off-site, in-person training. The ability to reach a large learning audience at one time is appealing too. It includes virtual classrooms, video conferencing and learning management systems (LMS), which are web-based software systems capable of creating and dispensing learning content. The LMS is particularly popular in the financial sector because it automates the tracking of compliance training.

6. Ask for feedback
The best way to show your employees that you value their opinions and that you are invested in their training and development programme is simply by asking them for feedback. What resonated? Were there any holes in the material? Asking for feedback ensures that your employees receive effective training that actually fosters their professional growth as well as your firm’s growth overall. Your training and development should be an ongoing process so make sure you take on board the feedback and compare it to your initial objectives and make the necessary tweaks. You can also monitor and track the feedback over time to identify trends in the overall effectiveness of your training, too.

7. Remember - successful training takes time
The most effective training programmes use layered, sustainable learning activities to create performance improvement over time. A layered approach makes sure your programme targets the essential employee and business needs, while training the right people at the right time in the right way. Training and development doesn’t happen overnight - it’s about identifying weaknesses, building skills and constantly reviewing the process to make sure you and your employees are getting the most out of your programme experiences and training methods that maximize the benefits of your time. Hiring top talent takes time and money - and developing that talent takes time too!

From increased profits to improved employee retention and increased motivation and engagement to productivity, the benefits of a dynamic training programme for both employees and employers are undeniable. Implementing a well-founded training strategy with an extensive compliance programme and financial, technological, sales and soft skills training courses will help your financial services organisation achieve better performance, gain clients and avoid regulatory issues. Looking for the right people for your business or want to find out more about financial crime training in the UK? Contact Twenty84 today!

 Financial crime training

Impact of Brexit on financial services

With Brexit looming, we look at what impact this might have on financial crime in the UK

It’s still not clear what is really going to happen with Brexit. Will the United Kingdom leave the European Union with some sort of agreement, will there be a No Deal Brexit, or will Article 50 be extended even further? What will be the impact of Brexit on financial services? Whatever happens, one thing’s for sure: there are growing concerns about the UK’s financial wellbeing after leaving the safety blanket of the EU. As well as potential economic instability, there’s also the question of the UK’s post-Brexit financial crime regulations.

Depending on the terms of the UK’s withdrawal, there are various legal mechanisms relating to fighting financial crime that are set to be dismantled. FCA Chair Charles Randall has warned that the UK may be unable to manage the risks of financial crime under a no-deal Brexit, emphasising the critical role played by cross-border data-sharing agreements with EU member states. From uncertainty about alignment in AML and sanctions regulations between the UK and EU post-Brexit to what it means for data sharing, when it comes to financial crime, the Brexit waters are pretty muddy. 

Current rules and regulations                                                                                                                             

When it comes to fighting financial crime, everyone is trying to combat the same things: money laundering, terrorist financing, sanctions, and human trafficking, to name but a few. But every regulator has its own way of trying to solve these problems. Up until now, the EU has had a uniform set of rules that are implemented across all of its member states, providing a pretty effective means of fighting financial crime within Europe. 

However, such rules and regulations don’t yet exist internationally – and when the UK leaves the EU, they will no longer have to enforce rules imposed by the EU, leaving a question mark above the issue of financial crime. After Brexit, the United Kingdom essentially has three choices about what to do with the current rules and regulations:

  1. Keep the regulations the EU has implemented the way they are now;

  2. Use the EU’s regulations but tone down enforcement actions;

  3. Come up with a different set of rules

When it comes to existing rules and regulations, the first option is the most likely. But what about when it comes to implementing new rules and regulations? Again, there are a few options:

 

  1. The UK can establish its own rules

  2. They can copy the EU’s legislation and adjust it as they see fit

  3. They can copy legislation developed by another country and adjust it according to their requirements

 

There’s no saying which of these options the UK will choose - but whatever happens, these uncertain times are likely to have a knock-on effect on financial crime. Let’s take a look at what this will mean for the financial services industry… 

 

Changes to trading platforms         

                                                                                                                       

One of the most likely outcomes of Brexit will be increased trade between UK businesses and companies based outside of Europe. For financial services firms, it’s integral that they ensure the necessary controls are in place and that they can manage any risks that come with this increased trade. The National Crime Agency is concerned that uncertainty surrounding Brexit could see criminals take advantage of changes to trading regulations, particularly around the implementation of a new UK customs union. Essentially, financial criminals will use any uncertainty to further their aims.

In May, the NCA stated that UK-based companies who are looking to increase trade with countries outside of the EU are more likely to come into contact with corrupt markets, particularly in the developing world. This may result in new money laundering schemes which firms must monitor (more on that below!). In addition, there will likely be extra costs for firms to ensure that their financial crime controls are sufficiently robust to handle the changes to trading patterns.

Information sharing                                                                                                                                                         

Brexit will also have a huge impact on information sharing. A significant change to be introduced by the 5th Anti-Money Laundering Directive is increased transparency of beneficial ownership, whereby the EU Member States will have wider access to each States’ register of corporates’ beneficial ownership. For UK-based firms, their involvement in information sharing will depend on the terms of the UK’s Brexit transition period.

This impact of Brexit on financial services could mean increased costs compared to other EU states, due to a lack of access to shared information. Not only that, but the efficiency and effectiveness with which firms with EU and non-EU entities identify and respond to financial crime may be reduced as a result of a fragmented approach to information sharing between the UK and EU. All of this again creates more opportunities for criminals to take advantage.

Money laundering                                                                                                                                                               

Money laundering is critical to funding criminal activity such as drug and human trafficking, and terrorist financing. The National Crime Agency predicts that money-laundering opportunities will increase following Brexit. Not only that, but the uncertainty surrounding the UK’s future outside of the EU could be exploited by financial criminals. According to the National Crime Agency (NCA), British businesses are at risk of being drawn into corrupt practices once the UK leaves.

Currently, the UK is part of a collaborative fight against money laundering and financial crime. One of the main benefits of this is that EU member states can trace suspicious money across borders through access to the Europol Information System (EIS). This essentially means that different countries within the EU can currently exchange criminal intelligence, making it much harder for criminals to cover their tracks. However, after Brexit, the UK may no longer be part of this intelligence sharing practice. This could give money launderers and criminals the perfect opportunity to take full advantage of any uncertainty.

Compliance                                                                                                                                                                        

Whilst details of the UK’s withdrawal from the EU remain unclear, it is not possible to definitively conclude the impact of Brexit on financial services across the country or how it will influence the UK’s approach to financial crime. One thing’s for sure, though: firms operating across both the UK and EU will most likely be looking at increased compliance costs due to increased regulatory complexity. As a result, firms operating across multiple jurisdictions could see an increase in compliance costs to ensure adherence to relevant sanctions and regulations, including additional reporting requirements.

Be prepared!     

If businesses want to be prepared for Brexit in whatever form it comes, they will need to take actions in the following areas to ensure they adhere to national financial crime legislations:

  • Draft new or update existing financial crime policies and procedures

  • Conduct business-wide risk assessments

  • Establish a financial crime compliance function, including governance structures, recruitment of staff, three lines of defence, culture, risk appetite and reporting lines

  • Carry out additional staff training

  • Regulator engagement

  • Develop new suspicious activity reporting processes

As the countdown to Brexit intensifies, fears surrounding the security of the UK are mounting. This means it’s vital that businesses become tougher in their fight against financial crime by following negotiations closely to assess how evolving regulations and changes to customer trading habits will impact them and ensuring that their controls are sufficiently robust to respond to change efficiently and effectively. Businesses must also ensure that they are extra vigilant and prepared with efficient monitoring systems to spot and prevent suspicious activity.

The terms of Brexit are still unclear, but one thing is for certain – the fight against financial crime is going to become tougher and it’s more important than ever that businesses are suitably prepared with the right systems in place and the best people on board. As experts in financial crime recruitment, if you’re looking to find the right people to ensure your business is protected against financial crime post-Brexit, we’re here to help.

 Twenty84

Five steps for successful compliance training for employees

We look at why you need a good compliance programme

Compliance training is the process of educating employees on the laws, regulations and company policies that apply to their day-to-day job responsibilities. It is employee training mandated by legislation, regulation or policy. Good corporate compliance programmes help to prevent poor conduct, ensure proper governance, minimise risk, maintain your reputation and provide a better working environment. Essentially, it allows employees to get familiar with the operating procedures, philosophies and policies of an organisation to ensure they recognise and understand regulations, helping them to create a better workplace.

Why you need a good compliance training programme

A good compliance programme is indispensable, is an integral part of a healthy and productive working environment and enables businesses to avoid risk. However, compliance training must be done regularly to ensure its effectiveness, and compliance policies cannot work unless they are effectively communicated throughout the entire company.

Sometimes, compliance training can feel like a moving target. But as the regulatory environments continue to evolve and change, designing a successful compliance training programme is more important now than ever before. Here’s how to deliver a successful compliance training programme for your employees:

1. Craft a strategic training plan

All too often, compliance training is reactive. But isn’t it better to identify potential problems and work proactively to change your corporate culture before a problem even occurs? That’s why it’s so important to create a strategic compliance training programme. Any good training programme starts with clear and definable goals. A commitment to compliance culture has to start at the top and work its way down – so it’s integral that you have a clear objective in place.

How will performance improve after the training? How will it prepare your staff to fulfil their roles and do their jobs effectively? What training is needed in line with current regulations? By asking these questions, you can define your objectives and what you are hoping to achieve – which makes it easier to review your training further down the line. You could gather input from all levels of your organisation, then craft a plan to ensure your training plan is proactive and that it resonates with everyone.

2. Decide who it’s aimed at

When it comes to delivering an effective compliance training programme, it’s essential that you know your audience. Much of compliance training is mandated, so people in certain jobs will need specific training related to that job. This is especially true of financial regulations such as IBOR (Interbank Offered Rate), SFTR (Securities Financing Transaction Regulation), SM&CR (Senior Managers and Certification Regime) and MiFID2 (The Markets in Financial Instruments Directive), as well as topics such as personal account dealing, conflicts, the conduct framework and financial promotions. 

However, there are some types of training that all employees need to know about;  in particular, HR issues such as preventing discrimination or rules and regulations around GDPR and the handling of data. Once you’ve identified who your training is aimed at, you can tailor it accordingly to make sure it’s engaging an interesting. Just remember that all training should be tailored according to the level of responsibility held by the employees and how far it is related to their particular role. 

3. Make it effective and engaging

It’s no secret that compliance training topics can be repetitive. All too often, compliance training is viewed as a box-ticking exercise that needs to be completed as quickly and as painlessly as possible. However, boring training is counterproductive for everyone. If you are going to get the most value out of your compliance training, it’s important that your employees are engaged. They need to complete the training with a full understanding of how it impacts their role and how the knowledge they’ll be gaining will be beneficial to them. 

Design proper training materials and make sure you prepare and deliver them in an effective and interesting way. You should also try to present information in simple and short incremental bursts, using concise language and avoiding technical jargon. Additionally, you could try and use a variety of learning methods and different ways of presentation to keep things interesting, too. Most importantly, wherever possible, you should support your training with real-life examples so your employees can connect their training with their everyday activities. 

4. Ensure it’s up to date

It’s absolutely vital that companies stay up to date with current regulations and make sure all training materials are in line with the latest changes. Compliance is continually changing and new regulations come in all the time - not only that, but changes that require retraining and restructuring are frequent too, especially in the financial services industry. 

All this means that compliance training must reflect those latest expectations for performance and best practices - so it’s integral that companies have training systems and partners that can respond quickly and efficiently to regulatory change. 

5. Ask for feedback

Every training professional knows that delivering the training isn’t the end of the process. Instead, your compliance training should be an ongoing process whereby you continually evaluate results, reassess any needs or additional content that needs addressing and incorporate these changes into the training and as when you go. 

There are plenty of ways to measure whether your training has served its purpose, but without a doubt, one of the most important is by simply asking your employees for feedback. Your employees want to know that their opinions are valued. If you don’t listen to their ideas and concerns, their enthusiasm and motivation will drop - which can have an impact on the whole company culture, not just in compliance training. Ask what they liked about the training, what they would change and how they found it overall. Their feedback can help you to continually improve your training and ensure that your employees get the most out of it. Over time, you’ll be able to see how effective your training programmes have really been by measuring the results of your feedback.

Conclusion

A successful compliance training programme comes down to careful planning, flexibility and continuity. Your compliance training programme should keep pace with all the latest regulatory changes, whilst  motivating and engaging your staff at the same time. If you’re looking to find the right people to ensure your compliance runs smoothly, our compliance recruitment experts are here to help.

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