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Recent banking scandals point to data quality problems

Rachel Wheeler Archive
Banks are complex institutions. A large, global banking organization has many layers of management and takes in a wide variety of information every minute. These many layers of management and informational complexity make the question of what went wrong in cases such as large-scale financial crises a difficult one for observers. The Harvard Business Review recently reported that, in addition to the ethics violations that have landed the bank in its present legal situation, U.K. bank Barclays has played host to numerous data quality faults.

Data problems solvable

Harvard Business Review drew a distinction over determining the role of employee intent causing problems for banks and purely bad data management. The source emphasized that there can often be gray areas in morality when a company is on the rise, with greed and ambition seeming inextricably linked, while data management is a simple case of success or failure.

The Review specified that the most important data from a quality perspective is information that will be seen outside the company. While disorganized internal numbers could lead to poor judgment, submitting bad data to customers or regulators is a disaster. Intent matters little in such a case - no matter how fraudulent numbers come to exist, they could lead to reputation damage and regulatory penalties.

The news provider stated that data security measures should be applied to every piece of a company's information, no matter which department it is meant to aid. Accurate figures, according to the source, can provide savings, aid important business decisions and help leaders ascertain the current status of their departments.

Guard against crises

Complying with governance requirements can be inadequate for companies' data management strategies. Even banks well prepared to face regulators can still find themselves in danger, whether as the result of employee malfeasance, the troubles of the market or failings of data their systems were inadequate to catch.

Business 2 Community recently detailed the compliance apparatuses put in place by JPMorgan Chase in the wake of the 2008 financial crisis. The complex efforts included a team of lawyers that worked throughout the company to institute new compliance efforts. The source stated that, even though the bank has been hit by devastating losses on the market, it has enhanced its chances of survival through the new, strong compliance program. In times of trouble, especially,