The Silicon Review
Appreciation of operational risks is growing. As a result, regulators are getting increasingly tough as they seek to ensure that every breach, omission or commission is punished with the consequent reputation risks. It’s costing firms billions of dollars every year.
The problem in respect to managing these ballooning costs is very similar to the old adage in respect to marketing spend: “Half the money I spend is wasted; the trouble is I don’t know which half.”
In view of the above-mentioned scenario, we’re thrilled to present Acin – the world’s leading risk and control data standards, benchmarking and controls data analysis company. Its breakthrough system helps to change the way financial institutions collectively think about risk and controls in order to improve the way their operational risks are managed and monitored across the industry.
Acin was incorporated in 2010 and is headquartered in London.
Acin has been recognised as one of the most innovative Regtech companies in 2019.
Paul Ford, Acin Founder/CEO, spoke exclusively to The Silicon Review. Below is an excerpt.
Brief us about your company.
Acin combines technology, data standards and content to measure, manage and mitigate operational risk – it relies on a comprehensive data standards platform.
The problem we resolve can be resumed by reference to the fact that financial institutions have reached a critical point. This has ballooned post the financial crisis in 2008. The banks have spent billions in building systems and hiring staff to demonstrate that they are ‘incontrol’ of the operational risks within their business.
Inconsistencies and formats are proliferating across firms and within the same institutions. Data is exploding, and more and more unstructured data is generated – some of it useful, some of it a distraction.
What do you think is the solution to this problem?
The solution I believe, and so do our clients, is Acin. At a glance it can be summarized by these three benefits:
Simplified – risks and their control, the issues of individual banks can be solved ‘out of the box’– Acin delivers real value.
Networked – defence system that standardises and benchmarks operational risks and controls for the whole industry
Benchmarked – operational risks and controls sets the industry standard for financial services
A clear demonstration of control to regulators – enables firms to demonstrate to regulators and other stakeholders, both completeness and quality of the control environment.
And we are providing our clients with control of the future – Acin’s Networked Defence Model is a next-generation risk management capability. Acin is far beyond any firm’s unilateral capabilities today and it is future-proofed and always up to date.
Most importantly, Acin works and is in production – with major client banks in the USA, across Europe, and in Asian firms.
The size of the prize is instructive as it hints why what we are doing at Acin is important.
The banks have incurred $190bn per annum in gross losses, $375bn in fines since 2012 and increasing, and £26bn per annum regulatory costs since 2008 for top Investment banks (source - AFME, Apr18).
Individual banks have over $1bn of Risk and Control operating costs.
As a data standards firm, we work on a subscription model, built out at a per library cost – scaleable by Desk, Division, or Enterprise-wide. The size of the market we serve is – £1.6bn per annum revenue opportunity.
How do you stay relevant to consumer needs and interests?
Acin is shaping the way risk and controls are managed in financial institutions, and we deliver unrivalled results.
We have created a comprehensive data standards platform to help firms to simplify and mitigate operational risk. Relying on a centralised database of control designs smart-mapped to individual risks by business or function; it is the first of its kind based on the Basel II framework.
And as an example of the results, we can deliver in creating a set of standards for investment bank trading desks. We found on average the desks were missing 32 percent of the operational risks and their associated controls.
We are proud to deliver value, right out of the box…but we do so much more.
More than delivering immediate value to individual firms we are also connecting them to a powerful networked defence system that offers the highest degrees of protection at an industry level.
What are the factors that make your company stand out from the competition?
What sets Acin apart is its centralised database of control designs smart-mapped to the risks faced by the individual business or function within a financial institution. Data is standardised, available, and reliable – at an industry level. More radical still is Acin’s ability to connect firms together to create the industry’s first risk and control defence network. With a dataset of risks and controls that is more comprehensive than that of any one institution and continuously updated via the network, this significantly strengthens each firm’s existing ‘three lines of defence’.
Our highly advanced system of risk identification, management and mitigation enable connected firms to achieve the highest degrees of protection at an industry level. This, in turn, empowers firms to reduce dramatically their operating costs.
As an engineer by training, I was always uncomfortable administering to the symptoms of operational risk, I have been determined to find the ‘cure’ – in Acin we have that answer.
Moreover, we have always focused on the delivery of our mission. Our proximity to clients is a defining feature of how we conduct business and grow it. As we now expand and enter new markets this client obsession will remain core to who we are and what we do.
What do you hope to accomplish in the long run?
In the longer-term, we aim to help firms reduce the amount of operational risk capital needed, and to replicate this across the industry.
There are billions of dollars in capital, and trillions in risk-weighted assets, tied up and, therefore, not productively deployed. We aim to help firms make the case as to how they can reduce their overheads and unlock the prize of having these assets appropriately allocated.
Paul Ford: An Entrepreneur at Heart
Paul Ford has over 25 years of operational and financial services experience. Prior to Acin, Mr. Ford founded Anchura Partners in 2010 and grew it to be a highly successful consulting business. Previously, he was the Chief Operating Officer of the ultra-high net worth business at Barclays Wealth and held various C-level positions at Credit Suisse in Europe, Middle-East and Africa.
Mr. Ford started his corporate career at Accenture. Prior to entering corporate life, he enjoyed a successful military career with the British Army; Mr. Ford was an officer in the Royal Engineers. This engineering background has continued to shape throughout his career; how he thinks about challenges, approaches, and solutions.