FIFA's Money Trail: What is it Teaching Firms about Internal Investigations? 

The FIFA investigation serves as a teaching moment for financial intelligence units. Here are five criteria for managing financial investigations.


21 September 2015

FIFA's Money Trail: What is it Teaching Firms about Internal Investigations? 

The recent (and ongoing) FIFA investigation serves as a teaching moment for banks worldwide.

When the U.S. Department of Justice and FBI handed down a 164-page indictment against FIFA earlier this year, based on an extensive and far-reaching investigation, governments and banks around the world followed suit, launching their own investigations of financial impropriety within the global organization. Dozens of banks had been named in the indictment, although none were accused of wrongdoing or criminal activity. Still, it served as a wake-up call which immediately initiated internal reviews to confirm compliance with anti-money laundering and bribery rules.

One of the factors that is making these reviews especially challenging is that accusations of FIFA's financial mismanagement stretch back two decades. Think about the changes that have occurred during that time: changes in banking regulations, information management, technology, and organizational structure have made the associated transactions difficult — and in some cases, impossible — to trace. It comes as no surprise that some of the relevant records have been lost (or were never archived in the first place).

Given the size and scope of the scandal, the banks’ financial intelligence units (FIUs) are investigating past transactions that cross national borders and include corporate parents, foreign branches and subsidiaries. Managing the investigation efficiently and securely requires the ability to communicate and collaborate securely — both inside and outside the firewall. Given the publicity this scandal continues to receive, one can only imagine the public relations nightmare that would result from a data breach or cybercrime related to the investigations.

The inability of investigators to communicate and collaborate securely has another possible consequence: the investigation may not be comprehensive and the data uncovered may be incomplete or inaccurate. This raises a red flag and opens the door to increased supervisory scrutiny, regulatory action, and potentially higher monetary penalties.

So what’s the best way for banks to manage financial investigations? The internal reviews being conducted now in response to FIFA can teach us a lot about investigating suspicious activity on a routine basis as well as in high profile situations. Here are five suggested criteria to live and learn by:

5 Takeaways: Best Practices for Managing Financial Investigations

  1. Act quickly.
    The banks mentioned in the FIFA indictment moved quickly to initiate their reviews, sending a clear message to regulators and the media that they have a sincere interest in examining their possible role in the scandal.
  2. Automatically archive and document information to preserve the audit trail.
    Being able to prove that documents are securely archived is necessary in order to demonstrate compliance with regulations. Banks involved in the FIFA scandal should be able to deliver clean audit trails for all requested documents.
  3. Centralize data collection.
    Aggregating documents in an organized format will help FIUs manage investigations more efficiently, enabling investigators to review necessary documents more quickly. Creating a secure central repository with controlled access is essential for managing a clean investigation.
  4. Control and secure communication & collaboration inside the organization and beyond the firewall.
    The investigative teams need to provide documents to groups within, and outside of, the banks. Having a secure way to manage content collaboration and the exchange of information, and being able to control what happens once a document is outside the firewall are two critical components of managing an investigation.
  5. Produce regulatory reports on time.
    One of the key elements in any investigation is response time. FIUs must have processes and supporting technology that enable them to adhere to the mandatory deadlines set and enforced by regulators.

Bank investigations are now more frequent — and more complex — than ever before. FIFA is but one example, and a high profile one at that. Taking a moment to examine your FIU or investigative team’s ability to respond to investigations and demonstrate compliance with far-reaching regulations, and determining how technology can enable or accelerate the investigations is time well spent.



Mark Kalen

Mark Kalen

Mark Kalen is worldwide director of product strategy and marketing for financial services at Intralinks. Mark received his MBA from Boston University and has worked over 15 years in financial services as executive and consultant specializing serving in a variety of roles including Sr. Director Risk and Compliance, VP Operations, and VP Product. His experience includes tenure at JP Morgan, Deloitte & Touche, State Street Bank, Wolters Kluwer, and Fidelity Investments.