How to Become a Bank Compliance Officer

Last Updated: February 3, 2023 References

Bank compliance officers manage and oversee the daily operations of financial institutions to ensure that they comply with all applicable federal, state and local laws. Job tasks generally include monitoring lending, accounting and investment practices as well as ongoing new developments relevant to regulatory compliance laws.^{[1]
X
Research source} Bank compliance officers are actively involved in the day-to-day operations of financial institutions and may be responsible for overall management duties.

Part 1

Part 1 of 3:

Getting an Education and Experience

1
Get a bachelor’s degree.^{[2]
X
Research source} An undergraduate degree is required to become a bank compliance officer. There is no set degree; however, common majors include accounting, business administration, or finance.^{[3]
X
Research source} In any case, you will prepare yourself for the job by taking courses in areas such as:
- Mathematics
- Accounting
- Finance
- Business Administration
- Statistics
- Economics
2
Seek internships.^{[4]
X
Research source} Interning at a bank or other financial institution can supplement your degree with practical knowledge and skills. This experience can give your resume an advantage and make you more competitive as a job candidate.
- Talk to professors you know well and/or your school’s career center about the possibility of doing an internship. You can also check with banks or financial companies, since many of these have established internship programs.
- Don’t overlook local community banks or credit unions when seeking an internship. In today’s banking environment, compliance officers are common at all types of institutions.
Advertisement
3
Think about places you can seek a job. The contemporary financial world is becoming increasingly regulated, and this means that there is a growing demand for bank compliance officers. Once you have your degree, you can start sending out lots of resumes and looking for a job in banking. You can think about working at:^{[5]
X
Research source}
- A commercial bank
- A credit union
- A retail bank and trust
- A private investment bank
- An international bank
4
Gain skills and experience. Most who enter the compliance field start out as an assistant of some kind in the compliance department of a bank.^{[6]
X
Research source} These positions provide valuable experience and on-the-job training that will help you learn the ins and outs of being a compliance officer. After getting three years or more experience, you can become certified as a bank compliance officer.
- Identify those aspects of banking that compliance officers should focus on; for instance, ensuring that practices are transparent, and that all transactions are properly documented.
- Focus on developing your communication skills. Since essential duties of a compliance officer can include relaying complex regulations and best practices to those in the banking trade, and to identifying and arbitrating when practices do not conform to standards, you will need to be able to communicate clearly and diplomatically.
5
Continue your education. Since laws and regulations related to the banking world are changing all the time, it is essential that compliance officers and those that want to enter the field stay abreast of developments and changes. Before getting certified, you must take 80 hours of compliance training classes approved by the Institute of Certified Bankers (ICB). These classes must be taken within the five years prior to becoming certified.
- Courses can be taken through the American Bankers Association (ABA), which offers a National Compliance School and an Online Review Course.^{[7]
  X
  Research source}
- Other options include taking courses through the American Institute of Banking (AIB) or a state banker’s association.^{[8]
  X
  Research source}
- These organizations maintain up-to-date lists of courses that can be taken in-person or online, as well as information on associated fees.
- Courses cover a variety of topics related to lending, investing, and accounting regulation.

Part 2

Part 2 of 3:

Ensuring Compliance

1
Manage compliance communications.^{[9]
X
Research source} One of the most important parts of a bank compliance officer’s job is ensuring that others stay informed about regulations and practices. Bank compliance officers communicate electronically, in writing, and in person to keep others abreast of policies, and to deal with any issues that arise. They may also communicate with the government or regulatory boards on behalf of a bank or bank members regarding topics related to compliance.
2
Stay informed about regulations.^{[10]
X
Research source} Bank compliance officers need to thoroughly understand all current banking regulations. However, since laws and policies may change over time, they also need to continue to research and learn about compliance. There are various tools bank compliance officers can use to stay informed, including the ABA Compliance Email Bulletin, continuing education courses, and individual research.
- Compliance officers do well to have a broad knowledge of banking regulations, but should also strive to develop particular expertise related to the kind of bank they work with. For instance, investment banks require compliance officers to be especially knowledgeable about laws and regulations regarding trading and securities. Likewise, personal banks complete more business related to things like small business lending, mortgages, and insurance, and so compliance officers working for such banks need to focus on the most relevant regulations.
3
Help banks develop best practices. Once compliance officers understand banking regulations, their job becomes helping other employees put them into practice. This involves working with managers to develop a bank’s best practices for dealing with each regulation, as well as training staff to implement these practices.
- For instance, if a new regulation regarding money-laundering goes into effect, then a compliance officer will help a bank determine ways to implement, monitor, and review transactions to combat money laundering with the new regulation in mind.
4
Review bank records and practices. Compliance officers help banks ensure transparency by enforcing good record-keeping and information sharing. They will then review these records and information to make sure that all regulations are being followed regarding topics such as:
- Fair lending
- Anti-money laundering
- Investments
5
Inform authorities of any problems that arise.^{[11]
X
Research source} One of the most difficult but essential parts of a compliance officer’s job is recognizing when regulations are not being followed correctly. The first step when a problem is recognized may be to work with bank managers to ensure that all involved understand the relevant regulations and are prepared to correct the problem. However, bank compliance officers must also be ready to report instances of fraud, embezzlement, unfair lending, and other problems to government regulatory agencies.

Part 3

Part 3 of 3:

Succeeding as a Compliance Officer

1
Get certified. At this time, there is no required certification to become a bank compliance officer.^{[12]
X
Research source} However, getting certified will increase your chances of getting a job in the field. The certification should lead to the Certified Regulatory Compliance Manager (CRCM) credential.
- Certifying agencies include the American Bankers Association (ABA), the National Association of Federal Credit Unions (NAFCU), the Center for Financial Training, the International Academy of Business and Financial Management (IABFM), and the Association of Certified Fraud Examiners.^{[13]
  X
  Research source}^{[14]
  X
  Research source}^{[15]
  X
  Research source}^{[16]
  X
  Research source}
- Three years of experience in banking and 80 hours of approved compliance training courses are required before you can seek certification as a compliance officer.
- To request certification, you must submit an application along with a reference from a senior banking official.
- You must also sign a statement attesting that you will abide by and uphold a code of ethics.
- The certification culminates in an examination comprising 200 multiple-choice questions.
2
Practice good ethics and accountability. Bank compliance officers are called upon to ensure that financial transactions and accounting practices follow all laws, regulations, and codes of conduct that apply. This work requires them to have the highest standards of ethics, a sense of responsibility, and a willingness to out wrongdoing. This means that bank compliance officers should be ready to:
- Monitor and analyze bank activities. For example, a bank compliance officer might study how a bank distributes home loans to ensure that there are no discriminatory practices.
- Expose and report suspicious banking activity.^{[17]
  X
  Research source}
- Ensure compliance with the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) standards.
- Help banks determine best practices in order to comply with laws and regulations.^{[18]
  X
  Research source} For instance, if a new law is passed regarding mortgage rates, then it is the job of a bank compliance officer to help a bank determine how to manage mortgages according to the new rate rules.
- Answer any questions the federal government or regulatory agencies may have.^{[19]
  X
  Research source} A bank compliance officer is the point of contact between a bank and regulatory agencies, and so he or she must be ready to research and explain any inquiries that these agencies have about a bank or its practices.
3
Join a professional organization. As a bank compliance officer, you can join an organization such as the ABA or AIB. These groups provide opportunities to network, information about job openings, access to conferences, and additional training.
- Be active in the professional organization(s) that you join: go to conferences, attend panels and networking events, contribute to web forums, etc.
4
Maintain certification. Certified bank compliance officers must keep their credentials up-to-date by taking 60 hours of training courses related to compliance every three years. Potential courses include those offered by the ABA, the AIB, or a state banker's association. These organizations maintain up-to-date lists of continuing education courses that can be taken in-person or online, as well as information on associated fees. Typical courses have titles like:
- “Credit Card Regulations”
- “Fair Credit Reporting Act”
- “National Flood Insurance Regulations”
- “Digital Compliance”
- “Privacy/Information Sharing”
- “Unfair, Deceptive, or Abusive Acts or Practices (UDAAP)”
5
Consider an advanced degree or additional training. While the only degree require to work as a bank compliance is a bachelor’s, some in the field seek advanced degrees or coursework. Additional education can make you a more competitive job candidate, open up opportunities to enter senior positions, or just deepen your knowledge in banking and finance. Common subjects of advanced degrees that bank compliance officers seek include:^{[20]
X
Research source}
- Business ethics
- Compliance
- Leadership
- Quantitative methods
- Finance management
- Marketing management
- Human resources
- Law
- Business Administration