#28 – RegTalks with Tarini Ponniah, Aspire
How do you explain AML compliance to a 9-year-old? Do creativity and out-of-the-box thinking have a role to play in client due diligence? And why are communication skills essential for today’s compliance practitioners? In the new episode of RegTalks, we explore the answers to these – and many more – questions with Tarini Ponniah, Head of Compliance at Singapore-based Aspire.
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Tune in to our interview with Aspire’s Head of Compliance Tarini Ponniah, where we explore:
- The main differences working in compliance at a traditional bank vs at a fast-growing Fintech
- How to successfully balance compliance needs and true customer-centricity when designing onboarding processes
- Why there is a lot to be optimistic about regarding the future of AML compliance
Tarini Ponniah is the Head of Compliance at Singapore-based fintech Aspire. An ex-Investment Banker from Barclays, Tarini is a CAMS- and CFA-qualified expert with 18 years of experience in banking and payments.
RegTalks is a podcast produced by Margherita Maspero for Know Your Customer.
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Claus: Welcome back to RegTalks, a podcast dedicated to the latest trends from the world of RegTech, Fintech and financial regulations. My name is Claus Christensen, and as you probably know by now, I’m the CEO and co-founder of award-winning RegTech provider Know Your Customer. Today, it’s my great pleasure to welcome Tarini Ponniah as my guest. Tarini is the Head of Compliance at Singapore-based Fintech Aspire. An ex-Investment Banker from Barclays, Tarini is a CAMS- and CFA-qualified expert with 18 years of experience in banking and payments. She also holds a Master’s in Finance & Economics from the London School of Economics. Tarini, thank you so much for being here.
Tarini: Thank you, Claus. Really, really excited to be here to see financial crime get the centre stage it deserves.
Claus: I appreciate it. To get started, would you mind telling us a bit about your compliance journey to date?
Tarini: In a perfect world, I would love to say it was all planned, but my life being my life, you know, nothing happens as planned. I kind of stumbled into investment banking many years ago. Loved it, did it for about 10 years. And like everybody out there, you’ve got to take part in compliance training and go through all of those motions. I’d be sitting there saying: “Oh, here’s another training…”. I would go through this saying: “Why am I doing this?”. As things happen, 2008 happened, the Big Crunch, regulations, compliance, that sort of conversations became really big. People started paying more attention to it and it really piqued my interest, which is why I sort of did almost a 180 and got into the governance and compliance aspect of it. And absolutely no regrets. It’s such a fascinating space, very fast-moving. Contrary to what a lot of people think. Yes, it is a lot of reading, and going through stuff. But things happen, and the nuances about it just keep me very interested and in my own little way, I like to think that I am helping keep out the bad players. A tiny, tiny little piece of what I do is trying to keep us safe and protected. The added kudos… I’m a superhero at home. I mean, how do you explain compliance to a 9-year-old? So I tell them I am money police. I sort of chase people who do bad things with money. So my kids love it.
Claus: I totally love that thought. I think your journey not being a very straight one is kind of typical by now. With a few people that I spoke to on this podcast, that are exceptional compliance leaders, you see the same thing. They came from another area and applied themselves and brought new experiences to it.
Tarini: Absolutely, because, as you say, coming from the same sector, but looking at it from a different angle sort of gives us a little advantage as well cause you’re from financial services., so you kind of know the ins and outs of how it works, or at least to some extent. I think that gives us that added leverage to be able to understand that piece a bit better.
Claus: Also, you have more experience having worked in both traditional and fast-growing Fintech companies. Have you noticed any recurring differences in how the compliance function operates across these two?
Tarini: I don’t know how long you have, Claus…
Claus: We have time.
Tarini: I mean, if you think about it, you’ve got the big traditional FIs who definitely have a lot more regulatory pressure, they’re definitely under a keen eye, and they’ve got bigger assets to manage. And then you’ve got the Fintechs who are more nimble, moving faster, everything is digital. So there’s definitely a stark difference. I mean, of course, in the bigger traditional FIs, you’ve got compliance teams which are siloed. There’s not one person or a small team, it’s impossible for them to manage the whole business or even get a holistic understanding. It’s never going to happen, which sort of creates friction because if you’re only working your role in your job, you don’t understand what the other person is doing or where they’re coming from. Whereas in a Fintech world, you get that opportunity to see everything more holistically. It’s a much bigger responsibility in the sense that you are responsible across the phase of compliance, all the different stages, the different pieces involved. You get to see first-hand what’s happening in the business. In both traditional FIs and Fintechs. I think compliance now gets a seat at the table. I think it’s now more about just getting your voice heard and being able to move faster.
Claus: Have you built your team in a different way in your organisation, now that is more nimble and is a Fintech, than you would have in a traditional institution?
Tarini: You know, funnily not. It’s actually a similar structure, but a smaller team focused on more things. But actually, the structure works. You’ve got the KYCs, the transaction monitoring, the periodic reviews and the escalations teams, all of those…. So, we’ve got all of those as well, but they’re smaller and they just talk to each other more, so they see a fuller journey.
Claus: Then it’s more the mindset that is siloed than it is an actual problem?
Tarini: Correct. Everybody has to see everything because the business has to move much faster and everybody makes a decision faster, as opposed to the bigger FIs.
Claus: Well, that does open up the possibility even for traditional institutions to start moving faster by changing mindsets rather than structures, really.
Heading the compliance department at a very successful, yet fairly young, Fintech organisation like Aspire must be an incredible roller coaster. I’d say it’s probably closer to our own experience as a RegTech scale-up than to working in a traditional bank. You have all the usual objectives and challenges of a head of compliance, but your focus is also in ensuring that the due diligence and compliance processes work in the most customer-centric and user-friendly way. Do you have any suggestions for our listeners on how you successfully balance the two?
Tarini: Well, successfully I think depends on which day you talk to me…
Claus: Same here. Same here in my function.
Tarini: Exactly. I think you hit the nail on head. You know, it truly is balancing the compliance requirements with the customer journey. And that’s not just for Fintech, I think that’s in every industry now. It’s not just about Fintech. Looking at the bigger banks, everyone wants to have that faster journey. They want everything smooth and snazzy… Instant approvals, instant onboarding, which is definitely a tricky case. My main agenda is that I want to change compliance professionals from being seen as the naysayers to being the enablers. It’s about growing your business sustainably for longer periods of growth. There’s no point in growing a business and making it really fast and really efficient and great until someone comes knocking on your door and says: “Hey, hang on a second. That’s not working”, which is what nobody wants. So I think the advantage of having compliance early on in conversations is building a product or building the journey in the most efficient way, where you get the customer experience, which is great as well as you tick all the boxes that you need from a compliance perspective. So that’s definitely tricky and it may work for a short period of time, but you know, things change. The requirements change. It’s a continuously evolving journey. I can never sit back and say, OK, I’ve got a process in place and this is now going to be in place for the next six months. That is not happening, sadly.
Claus: That is a very interesting thought. So that’s again a mindset shift where you see compliance as a work in progress forever, for long stretches of time, instead of: “Alright. I wrote my compliance manual. That’s it. Now I just hand it over, it’s executed and I don’t need to think about it”. That’s probably not the way anymore.
Tarini: No, definitely not, because things change. I mean, look at the tech out there. I mean, what you guys are providing takes so much of the burden off of the compliance professionals. And as you evolve, we evolve. So you’re saying: “Oh, hang on a second… I can leverage this off this platform, I can leverage this off this other vendor”. And that sort of makes our life easier. And so we’re able to then make changes to our flows, which impacts everybody in a positive way. So you’ve got to keep abreast with new things that are coming, new changes that are coming. We sort of coincide with what the regulations want as well.
Claus: Just to follow on that, have the criminals also got more inventive?
Tarini: Oh, they’re always one step ahead… You know, we think as compliance professionals that we know all the rules and we know all the regulations. You know who knows the rules? The criminals. But with the RegTech out there, we are getting closer. The gap between discovering a new loophole or discovering a new typology, and closing that gap… The time frame is much shorter now because you pick that up faster, you get approvals faster, you build things faster and this closes that gap immediately. So while the criminals may be a little bit faster, they don’t stay that well for a long time.
Claus: That is a good connection to the next question… when talking about compliance it’s very rare to hear the words “creativity” and “out-of-the-box thinking”. That is understandable, this is a space where it’s important to do things by the book. Still, in the last few years, we’ve seen some very inventive ways to improve the efficiency and accuracy of existing processes. And you mentioned it, technology is a big thing there, but these innovations come from both RegTech providers and the compliance practitioners in their respective roles. In your experience, what would be the most impactful innovations, the changes that we’ve experienced in AML over the past few years?
Tarini: Wow, there are actually quite a few. I mean, as you say, we have to be creative. Criminals are creative. If you look at your platform in terms of just getting KYC data, that’s at the click of a button and then now you’re looking at biometric verification, you’re looking at e-signatures. All these things have made AML checks and verification so much faster, so much smoother. It really has taken compliance to a whole different level where you’re actually able to sit back and analyse. So you’ve gone from a checkbox activity, saying: “OK, have I got the right documents? Do they look right? Is the paper torn?” to saying: “OK, I’ve got all this information, let me analyse It. Does it now make sense?”. And coming back to your creative side, I see compliance professionals as storytellers. We actually have to make a story about our client because it’s not just about doing KYC, or doing TXM, or doing periodic reviews. It’s understanding the whole customer journey. What do they want? Where do they come from? What kind of stuff do they want to do? So it’s building that story around the customer that helps us understand them better and makes it possible to monitor them in a much more efficient way.
Claus: Love that. I like also the optimism that I hear here, that things are actually moving and getting better. Luke Raven, who I spoke with on another episode recently posted a call for optimism on the future of AML on LinkedIn. And I like that. There is a new generation of practitioners entering the field with fresh ideas and maybe a little less jaded attitude. Do you see that too in your team?
Tarini: I think the good thing about the new generation that is coming into compliance is that they don’t have the baggage of how we used to do things in the old times. We are sort of moving them, as we have trained ourselves to be as well, to be more pragmatic. It’s not about looking in black and white at what is written in the law. It’s understanding the essence of what we’re trying to achieve. What is the story? What do the regulators want? And I think it’s that view from a compliance perspective which is really helping and for the new generation that’s coming in, at least in my team, my main training to them is: “OK, don’t tell me how it used to be done. Let’s see what we are trying to achieve here and how better can we do it?”
Claus: So that call for optimism has some backing there. Excellent.
Claus: What’s the prediction regarding the future of this profession then? I mean, we’re optimistic already, but the interesting question would be now, for the next generation, what skills and expertise do you think will be needed to continuously succeed in this space?
Tarini: The topmost skill I will foresee is pragmatism. Moving away from that set mindset to having an open view on what you’re trying to achieve. And if you approach it from that angle, it’s such an open space for us to come up with new ideas and how we want to do things. Everything is global now. I mean, sitting in Singapore, I’m not just supporting Singapore customers, right? We have customers from all over, so I can’t have one set of rules in Singapore that only meets the criteria here. I have to think globally, I have to think regionally. Business in Asia is conducted in a very different way from how business is conducted in the West. All those nuances are something one needs to understand. So, I think soft skills are really important, you know, communication. If you’re able to communicate the requirements properly with evidence of what we’re going to achieve, the chances of you getting some new changes through are much higher if you’re able to communicate it in a proper way.
Claus: Excellent. And I agree from my heart, having been through the compliance review process with a very large bank in Singapore recently, the communication skills could be better sometimes.
Let’s zoom out a bit. Aspire is not just any Fintech, it’s actually the strongest financial operating system in Southeast Asia. You’re headquartered in Singapore, but you’re growing quickly across the region. Quite often we have seen financial regulations in other Southeast Asian countries look towards MAS, the Monetary Authority of Singapore, as a model when developing their own regulations, including in the area of anti-money laundering. How do regulations in Southeast Asia have an impact on your role specifically and on Aspire’s business?
Tarini: We are a regional business, you know, so we can’t just focus on Singapore. Again as you said, MAS is a frontrunner here in the region for sure. They’re setting the model. They’re setting the pathway for some of the other regional countries to follow the lead. And it’s actually happening. If you see some of the countries in the region and the new payment laws that they’ve come up with, they’re very, very similar to what MAS came out with a couple of years ago. They’ve taken that as a guide and implemented their own with their own nuances. And given that we are in the region, I can’t just focus on Singapore regulations. I need to look at what’s happening in the region because Singapore, even as a country, doesn’t just transact with itself, it doesn’t do business with itself. It has to look regionally. I think what you really need is for countries to get together and have a similar foundation because then everybody works together, then nobody is working in silos, even as countries, you know, nobody’s going to work in silos. We all work together. We all have the same understanding of what is required for certain activities or from an AML perspective. It just makes life easier for clients as well as for compliance professionals.
Claus: We see that from the KYC perspective in our European operation. Europe is great in one way, in that it does have a unified anti-money laundering policy. And yet, even in this most positive setup, we still have a lot of differences between the implementation of those regulations on the national level and those are often the most difficult thing for global or regional operating players. If you look at the Fintech and payment space in Southeast Asia, where do you see some of the highest money laundering risks? Which areas or products should we pay particular attention to? Also from a KYC perspective, what should we do?
Tarini: I mean, from a KYC perspective, we work with corporates only at Aspire. So, the more documents we can get for corporates from the corporate registries, the easier it is for us and the customers. I know there’s some regions out there which make it harder to get instant documents. Even more so than that, I think what you have to realise is that in Asia the majority of business is still done verbally, over a handshake. They’ll discuss something over a drink or on a golf course or something. So, it is not as structured, which also can then lead to a lot of over-invoicing, those sort of traditional trade-based money laundering activities, which is quite rife in the region for sure. And I think more than that is the lack of communication between the regions as well. If you look at what happened in Australia, the $10 billion money laundering ring, some of the big perpetrators were on the blacklist in China, but they were given Australian citizenships because obviously you can’t share information across. That is also something we’ve got to look out for in the region: lack of communication. There are so many different areas, unfortunately, I can’t give you just one. These are the two that come top of mind.
Claus: One last question that I ask all my guests… if tomorrow you woke up and somehow you had become the global financial regulator, what would be the first thing you would do, and why?
Tarini: Wow, a million-dollar question there. You know, I think globally we’ve got the rules, we’ve got the foundation across the different markets and across the different regulators. But I think what we’re lacking is unity because each regulator is doing their own thing. It’s creating arbitrage opportunities for the criminals out there. If we think we know the laws and the rules in our country, the criminals know all the loopholes way better because you have these nuances across, which makes life not that easy.
So I think that’s one thing I would definitely look at – how to increase that cooperation, how to increase that unity or harmony of sharing information across. We’re all focused on that one objective which is to keep the bad guys out, keep our people safe, keep money safe. So, let’s all get together and share the information that we need to. That would just be amazing, that’s something I would definitely focus on.
Claus: I think it is something that might actually be achievable. All of us are currently faced with a world where there is a lot of disunity and there are blocks emerging and tensions everywhere. But this is one cause I think we can all get behind, really on a global scale, because no nation has any big advantages of allowing criminals and these operations can only be stopped on a global level and that’s something we can all get behind.
Tarini: Absolutely. And I think, you know, let’s not try and outdo each other because we’re all working towards the same goal. Let’s work together.
Claus: Excellent. Tarini, thank you so much for this excellent podcast. I love what you say and there’s so much positive going on. Great to see Aspire doing well in Southeast Asia, and, I’m sure, beyond pretty soon. We’ll be watching that space.
Tarini: Thank you very much for having me, Claus. I really, really enjoyed our conversation. And yeah, let’s see what happens in the global financial crime space. Let’s hope we can make a change.
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Last updated on April 17th, 2023 at 01:27 am