EY Canada buys anti-money laundering specialist Resolution Inc.

12 January 2021 Consulting.ca

EY Canada has acquired Resolution Inc., a Montreal-based consulting firm focusing on anti-money laundering.

Money laundering and associated crimes cost banks an estimated US$1.4-3.5 trillion annually. That’s in addition to the approximate $1 billion that each of the world’s largest banks spend on their financial crime operations every year.

On top of the rising costs related to anti-money laundering (AML) and counter terrorism financing (CTF), banks also have to manage and comply with shifting domestic and international regulatory frameworks. In Canada the Proceeds of Crime and Terrorist Financing Act will see a number of amendments come into force in June 2021 – including new and revised definitions, and several additional obligations for financial institutions.

Compliance failure can lead to sizable fines. HSBC in 2012 paid a US$1.9 billion fine to avoid prosecution for facilitating the laundering of at least $881 million from Mexican drug cartels. Australia’s Westpac was fined US$920 million last year for more than 23 million breaches of the country’s AML codes – including failing to flag transfers allegedly connected to child exploitation in Asia.EY Canada buys anti-money laundering specialist Resolution Inc. In Canada, Manulife was fined $1.15 million in 2016 for failing to report 1,174 international electronic money transfers, 45 cash transactions involving at least $10,000 each, and one suspicious transaction. The company said the failure stemmed from interpreting regulatory rules differently from how Canada’s regulators intended.

To help financial services firms better manage AML and CTF operations and compliance, Big Four firm EY Canada has acquired boutique firm Resolution Inc. Founded in 2015, Resolution’s team of financial, legal, tech, and management experts support firms in their AML-CTF programs, advising on technology, regulation, processes and procedures, data-driven systems implementation, and change management. The company’s client list includes large Canadian banks such as Scotiabank, National Bank, and Desjardins.

“Financial crime is on the rise and compliance requirements are shifting for Canadian financial services companies as more products and services continue to move online in response to Covid-19,” said Linda Williams, EY Canada managing partner, consulting. “Navigating this increasingly complex environment will require companies to embrace more business and data intelligence. We’re excited to join forces with Resolution to offer our clients just that.”

Resolution is led by Jean-François Isabelle and Guy Robert, who have a combined 45 years of financial sector, risk management, and consulting experience. The Montreal consulting firm has a team of nine professionals.

“Together with EY, we’ll help our clients approach financial crime holistically to not only address the technological and regulatory aspects, but also the responsibilities, processes and the implementation of data-driven systems,” Isabelle said.

EY in November acquired IDMSense, a Mississauga-based boutique cybersecurity consulting firm.