Vendor risk a growing concern for regulators

Financial institutions are working harder than ever to mitigate their operational risk in the post-crisis world, but what are the challenges they face when trying to ensure their vendors aren’t leaving them open to risks, and can they ever really fully control it?

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In July last year, the US Consumer Financial Protection Bureau (CFPB) announced its first public enforcement action since its inception in July 2011. Capital One – which offers bank, loan and credit card services – was forced to repay $140 million to customers who had been mis-sold add-on products, including payment protection insurance, by a third-party vendor of its products. The bank was also fined $25 million by the CFPB.

On top of this, the Office of the Comptroller of the Currency (OCC)

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