In some of our recent public actions we have required financial institutions to take steps to ensure that legal and reputational risks are adequately addressed, and these steps all involve or have the potential to involve legal professionals.
We have required institutions to establish controls that include the following: ·  a formal policy that addresses tolerance for legal and reputational risks, including regular reassessments of risk tolerance by appropriate senior management;  ·  procedures for assessing legal and reputational concerns and, where appropriate, escalating them to appropriate levels of senior management;  ·  transaction approval and monitoring procedures that involve all relevant areas, including legal; and that everyone in the process receive complete information about the transaction, including the counterparty's purpose;  ·  appropriate due diligence on control processes at the institution's corporate clients, and procedures for addressing any deficiencies in those processes that could result in increased risk exposure for the institution;  ·  depending on the risk assessment for particular transactions, enhanced review of the overall customer relationship that considers the entire consolidated organization, so that risks are identified and managed on a comprehensive basis and not in silos; and  ·  procedures to ensure that business lines comply fully with company policy for consulting with or obtaining opinions from outside counsel on particular transactions or client relationships.