Integrated risk management at loanDepot
“…ACL helps us get out of the subjective behavior of trying to define the work.”
VP Enterprise Risk,
loanDepot, America’s lender, matches borrowers through technology and high-touch customer care with the credit they need to fuel their lives. As a fast-growing national consumer lender, the loanDepot platform is disrupting finance by dissolving the lines between mortgage and nonmortgage credit. The company has funded more than $125 billion in loans since inception and is passionate about emerging financial technology and dynamic product delivery supported by excellent customer service to empower consumers.
Products in use:
Modern GRC platform
Develop risk practices to align with the velocity of the business.
Work together on content, hierarchies, risk frameworks, controls, and analytics.
Ownership and accountability
Connect transactions back to GRC to see if and where there was risk, and establish compliance.
Interview with Roger Scullion, VP Enterprise Risk at loanDepot
We operate in a highly-regulated industry and compliance has to be at the forefront. We manage a lot of regulations, but if we can do that more efficiently, we can start to do things once and comply with many, that really gives us that strategic advantage, differentiates us from the competition.
I think it makes us more agile, more responsive, more effective as business managers, to grow our business and not spend as much time in looking at the regulations and interpreting the regulations. That just happens in a modern GRC platform.
How does ACL help address your challenges?
I view ACL as a strategic partner for us both on content as well as how to structure what we want to do around our hierarchies, our risk framework, our controls, and moving much more into analytics.
I think ACL helps us get out of the subjective behavior of trying to define the work.
And it really allows us to get out of our chair and go meet with the first line of defense, the people in the business that are managing our risks, that own our policies, and if we can go and help them, that’s really where I think we’re going to get the most benefit rather than spending all the time working in spreadsheets, and doing this from a remote part of our head office.
What’s the biggest change you’ve noticed since implementing ACL?
GRC provides us with a way to both establish ownership and accountability in all of our business processes. So right down to the point of sale or the contact from a direct lender or a retail lender or wholesale, our JV partners, each of them should have a good understanding of what part of our business process is connecting back through GRC and allowing us to establish that compliance. It allows us to understand if there was risk in that transaction.
That brings it right down to that first line of defense for us. Second line of defense is obviously where we would use that information, third line is we’d hand it off to our auditors who can then go back to that business and talk to them about whether that transaction was performed in the right way and they’ve got all of the visibility and information to do that.
Why did you introduce GRC technology at loanDepot?
loanDepot is digitizing the lending model with sophisticated custom technology and an engineered process. Launched in 2010, loanDepot is now the second-largest non-bank lender, fifth-largest retail lender. We have 180 branch locations, 1,700 lending specialists, it’s $110 billion now in loans origination, with 400% market share growth annualized since 2012. So we really needed a modern GRC platform to develop our risk practices that were aligned with the velocity of that business.
I think where we’re going to be successful is if we can link our initiative around GRC with our core values as well as our culture, so embracing change and innovation, that entrepreneurial spirit…the ethics and integrity and that uncompromised ethical behavior. Doing the right thing, at the right time, in the right way is what we’re really focused on.