Data Integrity Reviews

Model Validations

Model Validations

An institution that has recently had a major system conversion/update, a merger, or an acquisition, should revisit the data being imported into their BSA/AML suspicious activity monitoring systems. BSA/AML Model Validation includes various components, and the data integrity review may be conducted independently as needed.

Most institutions obtain the data for their AML/BSA monitoring systems from multiple data sources, so to perform the required validation, multiple sets of data must be analyzed.

Data integrity review process should also include:

• Transaction comparison between data importing into AML system and original data sources.
• Determination as to whether the transaction code mapping between the source systems and the software includes all codes relevant to AML monitoring, are mapped appropriately and is there proper rationale supporting the inclusions or exclusions of transaction codes in the mapping process.
• Ensuring transaction and customer data are being transferred from all critical applications to the AML monitoring system completely and accurately so that it could provide for the timely identification of potentially unusual or suspicious activities.
• A comparison of the AML system data to core data and identified reasoning for any differences.
• A test of the accuracy and descriptiveness of data at the transaction level with a judgmental selection of transactions based on the most recent risk assessment.
• Ascertaining if the institution has an established and documented process to identify, track, and resolve data import errors from all critical systems to the AML monitoring system.

The validation teams at Arc-Serv will pinpoint weaknesses and rigorously support conclusions regarding the acceptability of the data importing into the BSA/AML model.