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sd-10-EFTA01418845Dept. of JusticeOther

EFTA Document EFTA01418845

KYC remediation plan Americas June 11th 2018 EFTA01418845 Executive Summary HR Status Updates were applied to the smooth-out schedule over the past week (the due dates for 83 customers accerterated to May and June were reverted back to their initial due dates pending AFC approval to use the smooth-out schedule for reporting overdues). May and June figures went from 107 and 124 respectively to 60 and 88 Total number HR customers due January — May 258; last weeks reporting was though A

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KYC remediation plan Americas June 11th 2018 EFTA01418845 Executive Summary HR Status Updates were applied to the smooth-out schedule over the past week (the due dates for 83 customers accerterated to May and June were reverted back to their initial due dates pending AFC approval to use the smooth-out schedule for reporting overdues). May and June figures went from 107 and 124 respectively to 60 and 88 Total number HR customers due January — May 258; last weeks reporting was though A

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KYC remediation plan Americas June 11th 2018 PROT0 Executive Summary HR Status Updates were applied to the smooth-out schedule over the past week (the due dates for 83 customers accerterated to May and June were reverted back to their initial due dates pending AFC approval to use the smooth-out schedule for reporting overdues). May and June figures went from 107 and 124 respectively to 60 and 88 Total number HR customers due January - May 258; last weeks reporting was though April month end (198 customers) 199 have been approved 59 are overdue; 25 from Jan - April (a reduction of 7) and 23 are pending approval; 8 from Jan - April (a reduction of 6 are in progress; none remaining from Jan - April 30 in rejected status; 17 from Jan - April (a reduction of pending client documentation or research and 7 are pending Manager / Banker. HR June 15th target for submitting cases 2 weeks prior to month end due date - There are 30 customers whose KYC has not yet been started (this represents 11 relationships) to be initiated next week. Process and Quality, Resourcing and Offboarding (3 levers) A revised 2018 remediation schedule was submitted AFC (Irwin Nack) who subsequently submitted it to global AFC for approval to use the "smooth out" approach for tracking and reporting overdues (global AFC approval pending) A 48-hour rejection turnaround requirement for case managers has been instituted and AFC should start to see improvements within a week; tracking continues to be challenging given it is manual Resourcing: Given the current ABR resource gap a creased in the moderate and low risk backlog for this segment is expected to be realised beginning 2H 2018 Case Managers: 24 out of 26 resources on-boarded and one offer accepted (a replacement for 1 resource who transferred to ABR ABR (KYC SME and Neutral Control): 5 our of 9 FTE are on-boarded with hiring expected to be completed by the end of June and respectively training by the end of July. In addition, hiring in progress for 12 temps with 5 offers excepted to go out in the near-term Off-boarding: The small account closure program has been initiated, account closure framework, templates & communication to be completed in June; actively working with legal to finalize letters and client notification timelines and a project manager has been identified focused to focus on tracking and reporting Passcon: the vendor Passcon will be on-sight in NY next week to perform a review of the remediation program to identify opportunities and solutions for improvement (referred by DB executive management) WM Americas KYC Program 34 from May 4) and 15 from May 2) with 23 are with the RM/ Case PROT1 Program Status - Q1 / Q2 (as of 6-8-2018 - based on the smooth-out schedule) Total Approved Overdue Primary Officer MD ABR AFC Not Yet Started In Progress Rejected Approved High Risk 31/01/2018 57 57 100% High Risk 28/02/2018 54 53 1 1 98% High Risk 31/03/2018 44 32 12 4 8 PROT2 73% High Risk 30/04/2018 43 31 12 3 9 72% High Risk 31/05/2018 60 26 34 15 6 13 43% High Risk 30/06/2018 88 9 2 3 30 39 5 10% High Risk Total 394 256 59 4 5 19 30 45 PROT3 35 65% Moderate Risk 31/01/2018 43 23 A risk acceptance is in place for until YE 2019 8 3 5 4 53% Moderate Risk 28/02/2018 72 38 13 6 9 6 53% Moderate Risk 31/03/2018 98 20 1 30 11 24 12 20% Moderate Risk 30/04/2018 88 24 1 30 15 13 5 27% Moderate Risk 31/05/2018 88 6 3 1 PROT4 20 34 20 4 7% Moderate Risk 30/06/2018 315 28 3 6 57 36 83 102 9% Moderate Risk Total 704 139 7 8 158 0 105 154 133 20% Low Risk 31/01/2018 14 13 A risk acceptance is in place for until YE 2022 1 93% Low Risk 28/02/2018 29 19 PROT5 2 8 66% Low Risk 31/03/2018 117 37 2 1 9 47 11 10 32% Low Risk 30/04/2018 161 35 1 20 84 18 3 22% Low Risk 31/05/2018 139 13 2 29 76 17 2 9% Low Risk 30/06/2018 161 42 3 1 PROT6 16 87 10 2 26% Low Risk Total 621 159 5 5 74 0 297 64 17 26% Total 1671 506 59 12 17 237 19 432 263 185 30% PROT7 Program Status - Q3 (as of 6-8-2018 - based on the smooth-out schedule) Total Approved Overdue Primary Officer MD ABR AFC Not Yet Started In Progress Rejected Approved High Risk 31/07/2018 55 9 Not yet due 2 [repeated 3 times] 23 6 11 16% High Risk 31/08/2018 148 10 Not yet due 1 1 109 23 4 7% High Risk 30/09/2018 87 13 Not yet due 1 1 2 52 14 4 PROT8 15% High Risk Total 290 32 4 1 2 5 184 43 19 11% Moderate Risk 31/07/2018 120 1 2 1 105 8 3 1% Moderate Risk 31/08/2018 111 2 1 87 20 1 0% Moderate Risk 30/09/2018 126 6 104 16 PROT9 5% Moderate Risk Total 357 7 4 2 296 44 4 2% Low Risk 31/07/2018 133 2 1 120 10 2% Low Risk 31/08/2018 156 2 152 2 1% Low Risk 30/09/2018 138 4 128 6 PROT10 3% Low Risk Total 427 8 1 400 18 2% Total 1074 47 258 8 1 5 5 880 105 23 4% PROT11 Appendix PROT12 Approach, Risk Acceptance, Reporting KYC Schedule WM Americas applied a "Smooth-out" approach for remediating clients (back book) and performing regular reviews This approach "smooths out" the # of clients to KYC per month per banker including grouping relationships together, where feasible while also accounting for consistent volumes for quality assurance and approval functions Allows for proactive resource / staff planning / optimization given load balancing KYC volumes (per banker) across the calendar year and identification of the annual KYC population in advance of the calendar year Note: As a majority of 2017 regular reviews were performed in Q4, the 2017 KYC approval date was not used as the basis for the next review date in the smooth-out (i.e., this would have resulted in a large number of reviews to be performed in Q4 2018) Risk Acceptance A Risk Acceptance was formally put in place on 29 March 2018 to bring US KYCs to Policy standard as WM Americas has operated under a regional policy since 2009. It was concluded that the best way to proceed is to ensure that the highest risks are addressed first, as resources and technology solutions are enhanced to make the high volume of work sustainable. High Risk to be completed on an annual basis - 2017 High Risk back book remediation done by March 2018 (as communicated in the PWCC KYC SteerCo) Medium Risk to be completed by end of 2019 Low Risk to be completed over a 5-year period (through 2022) Reporting WM Americas KYC Remediation Program is to be based on the due dates defined in the smooth-out schedule and as such it is understood that their may be instances where the performance of regular review may go over a policy deadline as necessary to established a sustainable BAU regular review schedule . PROT13 Smooth out schedule Total'18 Jan Feb March April May June July Aug Sept Oct Nov Dec High Risk 1019 73 65 50 47 79 88 49 148 87 127 105 101 Moderate Risk 1421 43 72 98 88 88 315 120 111 126 115 113 132 Low Risk 1467 14 29 117 161 139 161 133 PROT14 156 138 160 139 120 Total 3907 130 166 265 296 306 564 302 415 351 402 357 325 2018 Periodic KYC plan based on existing Risk Acceptance PROT15 PROT16 1_ Office Theme Confidential Confidential PROT17 2 DB Deutsche Bank Wealth Management Confidential Confidential PROT18 3 DB Deutsche Bank Confidential Confidential PROT19 7 DB Deutsche Bank Confidential Confidential PROT20 8 DB Deutsche Bank Confidential Confidential PROT21 9 DB Deutsche Bank Confidential Confidential PROT22 13 DB Deutsche Bank Confidential Confidential PROT23 14 DB Deutsche Bank Confidential Confidential PROT24 15 DB Deutsche Bank Confidential Confidential PROT25 2 DB WM Template slides Deutsche Bank Confidential Confidential PROT26 17 DB Deutsche Bank Confidential Confidential PROT27 1 lfffbed9-35dc-4496-aba8-4dd4c4c4cael Deutsche Bank Confidential Confidential PROT28 5 DB Deutsche Bank Confidential Confidential PROT29 16 DB Deutsche Bank Confidential Confidential PROT30 6/8/2018 Click to edit Master text styles Second level Third level Fourth level Fifth level PROT31 6/8/2018 PROT32 1 Title/Divider PROT33 24 Custom Layout Section Title Headline Text Click to add source PROT34 47 Custom Layout Deutsche Bank Text Orange lOpt Deutsche Bank Display Dark Blue 36pt Deutsche Bank Text Dark Grey 8pt PROT35 Section Title Headline Text PROT36 Section Title Headline Text PROT37 Section Title Headline Text PROT38 Section Title Headline Text PROT39 PROT40 PROT41 PROT42 Deutsche Bank Display Dark Blue 28pt PROT43 <?xml version="1.0" encoding="UTF-8" standalone="yes"?>croot reciver="23045"><version val="25113"/><CSmartGrid id="1"><m setpartgrdlnpairConstraint/><m_veclineshape length="0"/- ><m setguidGridlines/><m containerse idref="2"/><m_cgenconn/><m sltbsc idref="3"/><m nPpVersion val="4222124975916008"/- ><m athmcolThimeColorTable><elem type="2" r="00" g="00" b="00"/><elem type="2" r="FF" g="FF" b="FF"/><elem type="2" r="44" g="54" b="6A"/><elem type="2" r="E7" g="E6" b="E6"/><elem type="2" r="44" g="72" b="C4"/><elem type="2" r="ED" g="7D" b="31"/><elem type="2" r="A5" g="A5" b="A5"/><elem type="2" r="FF" g="CO" b="00"/><elem type="2" r="5B" g="96" b="D5"/><elem type="2" r="70" g="AD" b="47"/><elem type="2" r="05" g="63" b="C1"/><elem type="2" r="95" g="4F" b="72"/><elem type="1" val="1"/><elem type="1" val="2"/><elem type="1" val="3"/><elem type="1" val="4"/></- m athmcolThemeColorTable><m bDividerPage val="0"/><m cadvisesink/></- C§uartGrid><CSLTBSizeCalculitor id="3"><m econsstate - 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