By 2008, Jeff Ross already had enjoyed a distinguished 25-year career with the U.S. Department of Justice and the Treasury, racking up accomplishments such as helping establish the FBI’s first interagency anti-terrorism financing task force in the wake of 9/11, while earning accolades including the DOJ’s John Marshall Award and Treasury’s Meritorious Service Award. With nearly three decades of service and a host of achievements under his belt, Ross had the opportunity to retire. But instead of riding off into the sunset, he decided to move across the country to sunny Southern California and make the leap into the private sector, taking over as senior vice president, BSA/AML officer for Pasadena-based prepaid giant Green Dot Corp.
Now nearly a decade into the second phase of his career, Ross remains as enthused as ever by the new challenges and complexities he faces every day as compliance head for one of the biggest players in an industry facing a constantly shifting regulatory landscape and technology that’s advancing at a breakneck pace.
For Ross, the decision to jump into the private sector was mainly motivated by the specific opportunity Green Dot presented. His daughter had just left for college at the time, and Ross had become quite familiar with the company during the course of his work at Treasury, which often brought him into close contact with prepaid stakeholders.
“As prepaid products got established, I became a strong proponent of working closely with the industry,” Ross recalls. “I was intrigued with the space and the more I heard, the more I was impressed with the care that was being taken from an anti-money laundering perspective.”
Ross was presented with the opportunity to join Green Dot by the company’s general counsel, John Ricci, whom he’d met at an industry event. “I had other opportunities to go into the private sector, but this seemed like the most interesting one,” Ross says. “And it certainly has been.”
In his role with Green Dot, Ross is responsible for all aspects of Bank Secrecy Act/Anti-Money Laundering (BSA/AML) and Office of Foreign Asset Control (OFAC) compliance for both the main corporation and Green Dot Bank, the company’s card-issuing bank subsidiary. Green Dot’s products and services range from traditional GPR and payroll cards, to the GoBank financial services account and payments to Uber drivers. Because each area has its own unique compliance requirements and challenges, there’s plenty to keep up on. “There’s rarely a dull day, and you need to make sure you’re constantly learning,” he says.
|Biggest Compliance Challenges
According to Ross, one of the biggest compliance challenges facing the payments industry is the growing role played by digital technology and tech firms in the ecosystem, which was once dominated by established banks and financial services providers. “With all of the different disciplines teaming up to move funds, making sure the end product stays within compliance requirements is often difficult,” he notes.
Exacerbating the issue is that many of the laws governing payments are outdated, designed for the way things used to work, not how they work today. “We’ve got new technologies to move funds, but we’re dragging the past 200 years of regulations with us,” Ross observes. “So we’re trying to take this historical framework and apply it to the modern era, and that doesn’t always work.”
With technology advancing rapidly and new players entering the market on a near-constant basis, payments are changing fast—and existing regulations often weren’t designed to deal with the way modern products and services function (see sidebar). To successfully navigate the often-uncertain regulatory waters that result from that disconnect, it’s important for firms to involve their compliance departments from the earliest stages, Ross advises. “Compliance folks don’t like to be surprised” by products that are already far along into development and may present compliance issues, he notes. Furthermore, heading off any problems as soon as they arise is far more cost-effective than having to redesign—or outright kill—an idea.
And like compliance professionals, regulators aren’t too keen on surprises either, Ross warns. That’s why it’s imperative that payments providers reach out and create an open and ongoing dialogue with regulators—who may be more open-minded than expected if brought into the loop early on, he says. By way of example, Ross cites the deal Green Dot struck with PayPal in 2009 to enable PayPal users to load their accounts with cash via Green Dot’s MoneyPak. Aware from the start that offering the ability to turn cash into electronic money anonymously could cause concern about criminal uses, Ross and Green Dot proactively contacted law enforcement officials. “We went and talked to them and outlined the controls we had in place,” he recalls. “And when we finally rolled out the service, there was no blowback, because we had already had that dialogue.”
Ross’s experience in the public and private sectors affords him a unique perspective, with his government work granting him a keen sense of what regulators and law enforcement might be concerned about, as well as the mechanics of how regulation functions between the various agencies at the federal and state levels. One major difference in the private sector versus the public is the faster pace at which things move, Ross notes. “In government, when you make a decision, it’s often not the final word, because there are always layers above you. Here, when you make a decision, it’s locked in. That’s the biggest difference, I think.”
When he’s not helping make the key decisions for Green Dot’s compliance efforts, Ross can often be found enjoying the Southern California sun by jogging, hiking or taking day trips to the beach. “It’s a wonderful place to just relax, take it easy and enjoy the weather,” he says.
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