AML execs in high demand among banks

Years ago, as U.S. Army Sgt. Jon Elvin scoured the Arizona desert for signs of narcotics traffickers, one of the last places he would have expected to end up was working at a bank in Pennsylvania.

While his closely cropped haircut and gait give away his military background, the Army reservist has spent many of his waking hours since early 2004 making sure crooks, shady businessmen and terrorists aren't moving tainted money through PNC Financial Services Group Inc.

Elvin is a vice president at PNC, overseeing the Pittsburgh-based bank's anti-money-laundering efforts. Using instinct, sophisticated global databases and social-networking software, he and his team can tell if a would-be checking-account holder is the family member of a corrupt dictator or a suspected terrorist on an international watch list.

The 39-year-old Elvin is among the financial-services industry's growing army of front-line soldiers during a time when bad guys move money in ever-changing ways and regulators are passing out multimillion-dollar fines to financial institutions that fail to keep diligent watch.

His talents and those of other analytical types like him are in great demand at banks and other financial institutions, many of which now consider not having a strong compliance operation a threat to their bottom lines and reputations.

In an online survey conducted last month by the American Bankers Association, U.S. bankers, by a wide margin, identified the most demanding compliance issue they face in 2007 as keeping up with the numerous anti-money-laundering requirements imposed on financial institutions.

"The stakes are much higher. I think everyone gets it now that if I don't do this right, this could really put our company at risk," said Jack Wixted, PNC's chief compliance officer and Elvin's boss.

One result of this increased awareness: Membership in the Association of Certified Anti-Money Laundering Specialists has swelled to more than 5,200 members from fewer than 500 five years ago. Another: Some large banks are currently offering $500,000 or more a year to recruit top compliance executives with anti-money-laundering experience, much more than the $165,000 national median salary that Salary.com says a regional retail bank president commands.

The thirst for top talent like Elvin, who possess a knack for turning regulatory marching orders into working operational plans, is so large that regulators and banks have attempted to lure veteran compliance officers out of retirement or away from lucrative consulting gigs to meet demand.

In some instances, regulators have complained to banks to stop raiding their ranks for those with the proper experience. Robert Werner, one of the Treasury Department's top anti-money-laundering officials, became the latest high-profile regulatory defection Jan. 2 when he resigned as head of the Treasury Department's Financial Crimes Enforcement Network to join Merrill Lynch & Co.

"There is such a void in talent. You have a lot of people out there with only two to three years' experience," Elvin said. "It's a numbers game all over the industry."

Since the 2001 terrorist attacks and the subsequent passage of the USA Patriot Act, which requires financial institutions to scrutinize accounts and other data for "suspicious activity," the cost of not complying with the nation's expansive anti-money-laundering rules has continued to rise.

In 2001 and 2002, total fines handed out to banks violating the federal Bank Secrecy Act, which sets out anti-money-laundering requirements, totaled $1 million, according to an analysis by the online newsletter Money Laundering Alert. During the past two years, that amount has climbed to more than $87 million.

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