Encompass Corporation is a leading RegTech company which utilises technology to automate Know Your Customer (KYC) policies, enabling companies to adhere to Anti-Money Laundering (AML) and Counter Terrorism Financing (CTF) regulations in financial, legal and accounting businesses. Founded in Australia in 2012 the company launched in the UK in 2015 with offices in Glasgow and London.
Johnson tells us more about the software behind the firm. “With a recent report showing that KYC and customer due diligence are costing financial firms an average of £47 million, the demand for more comprehensive and easier-to-use solutions is growing, and that’s where we come in. One analyst group specialising in RegTech, JWG Group, estimate that between £10 billion and £20 billion a year is being spent in the UK on meeting regulatory obligations. This is equivalent to 0.7% of UK GDP – more than the UK agricultural sector – so it’s a significant issue.
“Our software enables KYC checks and initial client screening of corporate customers to be completed up to 10 times faster and with significantly lower costs. Through our use of web-based technology we also provide an audit trail that is not only regulator ready, but drastically reduces the risk of human oversight that is too often part of a traditional manual process.
“Using real time data from more than 12 different information provider partners including World-Check, Experian, C6i, BvD and Companies House, we currently serve over 200 firms globally.”
Encompass’ vision is a world where business people can truly know their customer at the click of a button. “We’re constantly evolving to meet new regulatory demands and the ever-increasing complexity of understanding company structures and beneficial ownership across borders,” states Johnson.
“We continually add new domestic and international data providers so that our customers have confidence that when they are building a client profile on our platform that they will receive all the pertinent information in an easy-to-understand format, enabling them to make informed and timely business decisions.”
Given the digital transformation taking place in financial and professional services it is important for Encompass to stay one step ahead of the curve in order to differentiate itself from the competition. They do this by automating the KYC process, which saves customers both time and money, and through their unique unified data model, which combines AML data from a range of different information providers, so that it can be used to build a picture of a client’s risk profile.
“Being data agnostic means we don’t favour or promote any one information provider partner over another,” Johnson explains. “Our customers can run reports using a number of different providers simultaneously depending on their needs and instantly overlay credit, AML, identity, PEPs and sanctions information within the one client profile. They can also refresh KYC policy checks in bulk, again saving time as they no longer have to manually input their search criteria or manually analyse the results – this is particularly useful when there is a ‘book’ of clients to be remediated. In 2014 KPMG estimated that global spending on Anti-Money Laundering (AML) compliance alone amounted to $10 billion, so there is much to be gained through streamlining these processes.
“The audit trail that results from our automated process assists customers to stay compliant, and critically – prove due diligence has occurred.”
With compliance and regulation being constantly updated and becoming increasingly stringent, a key challenge for risk and compliance professionals is to stay ahead of legislation passed at a governmental and intergovernmental level. According to the 2016 Future Financial Crime Risks report from LexisNexis & BBA, AML Compliance costs have increased by 50% in the past two years and are rising.
“We deal with this by ensuring our products are agile enough to continually adapt to policy changes. Having an agile product also means it can be updated according to our customer’s policy requirements, which in turn makes operationalising a policy change at scale much more achievable.”
Of course, it’s not all about the products and Johnson tells us that the company was initially founded with his business partner Roger Carson, following the pair being defrauded in a property investment.
Reflecting on the fact that had they had access to the full picture, they never would have proceeded with that property deal; “Roger and I are acutely aware of what can happen should customers not have access to timely and relevant information. With this at the heart of our culture, our Customer Success team works closely with all our customers, ensuring they get maximum value from Encompass’ products, accessing information that not only enables them to be compliant, but fully informed with regard to their customers.”
Last year Emcompass secured £3.6million in investment funding which helped it transition from a company offering support to accountancy professionals, to supporting those in the legal and finance and banking sector. Johnson foresees 2017 being an equally exciting year.
“During the next 12 months we plan to consolidate and grow this market both in the UK and globally. Having been selected for the UK government’s RegTech mission to New York in April 2017, we are moving along a trajectory toward expanding into the North American market.
“With regards to the wider industry, we forecast that regulations around Anti-Money Laundering and Counter Terrorism Financing will continue to be a focus for governments across Europe and globally. To date, these regulations have been getting stricter on those who are found to be in breach of these rules. This trend will continue with both AMLD4 and AMLD5 both coming down the line. To date, we have seen some serious fines and sanctions passed to banks and financial institutions for being in breach of these rules. Moving into 2017 and beyond, we expect that regulators of professional service will also being paying closer attention than ever before, as evidenced by the recent ‘flag it up’ campaign – a joint initiative involving the Accountancy Affinity Group, the Home Office and National Crime Agency (NCA) to tackle the serious threat of money laundering.
Company: Encompass Corporation
Name: Wayne Johnson, CEO
Web Address: www.encompasscorporation.com
Address: Encompass, Level 3, 39 St Vincent Place, Glasgow Scotland G1 2ER
Telephone: +44(0)141 406 7761