Don’t Get Scammed! How to Vet Risk Management Consulting Firms

Welcome. Dear listeners, to the speak and flow podcast where we dive into unique strategies to help you and your team achieve maximum potential and flow even when the stakes are high and the pressure is on, and I have the best person to help guide us through this. His name is Kevin Odin. He's the CEO of Kevin D. Odin and Associates.

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Melinda Lee: He's an Advisory Board member for Theon Technology, and he's also been the head of operational risk and compliance for

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Melinda Lee: Wells Fargo. Welcome, Kevin.

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Kevin Oden: Well, thank you for having me.

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Melinda Lee: Thank you so much for being here. We're going to dive into such a rich conversation around. Who, to be careful for what kind of people to look for. And how do we protect ourselves when we deal with just there's so many different people, so many types of people out there. So we just kind of want to dive into that conversation today. And before we get into that, can you share you? You lead such high profile risk projects for clients.

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Melinda Lee: And so what makes you excited today.

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Kevin Oden: So look, I, I get excited every day. I'm working on you know, a project, or most most days. It's multiple projects. Today, we're, you know, gearing up for a new engagement. With a new client who's been

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Kevin Oden: working through some regulatory issues. You know, regulatory issues are certainly something that almost every financial institution is familiar with to some degree or another. This one has been working through some regulatory issues for several for nearly a year now. So we're going to come in and we're going to try to help them solve their problems. We're not going to try. We're going to help them solve their problems.

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Melinda Lee: Yes, yes, and so with the new administration has the regulatory issues been even more tightened? Has it been.

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Kevin Oden: So that's a that's a that's a great question. It's it's really the jury's out right now on on that. Certainly. The Cfpb. Has

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Kevin Oden: has loosened constraints or loosened regulatory oversight. In many respects it's unclear what's happening with the Federal Reserve Board. The Occ. Etc. For now it appears that it's other than the Cfpb. It's regulation, as usual. So if you have an outstanding issue with one of the Regulators.

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Kevin Oden: you better resolve it. So where that goes in the next 3, 3 and a half years still remains to be seen.

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Melinda Lee: Yeah. Yeah. So any financial institution who is concerned or unsure of how to deal with these policies compliance. You are a consultant to them. What are some of the things that they look for to be wary of when they're looking for a risk? Consultant like.

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Kevin Oden: Yeah. So I just mentioned a firm that we're about to to engage, and without mentioning the name of the firm or the the name of the organization that they that they brought in but they brought. They brought in a big name organization to help them resolve their regulatory issues, and literally

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Kevin Oden: After the Regulators came back in to see where they were at the supposed halfway mark, they basically said, this is, this is garbage. So we're we're gonna come in and we're, gonna you know, get them on the right path to resolving the regulatory issues. But to the heart of your question a lot of these big name organizations, and even some of the smaller ones

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Kevin Oden: they send their. They send their big named person in day one and

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Kevin Oden: that person sort of goes away and or makes appearances infrequently. But the people that are doing the work.

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Melinda Lee: -

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Kevin Oden: Generally junior individuals. Maybe they're at us 2 years out of school, even if it's an Mba. If you haven't worked through regulatory issues in the past. If you're not very familiar with the banking environment, it's going to be difficult for you to understand how to put together a roadmap for resolving a lot of these issues.

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Kevin Oden: It's this. And you know we don't do that. The people on our team in some cases, have, you know, decades worth of experience. But most of them have, you know, 10 years worth of real experience. So they've they've had to carry those regulatory burdens on their back physically and get them lifted off.

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Kevin Oden: So that's the difference between even though we're a small institution every the small bank. I'm sorry. Small risk consulting firm. We just have that experience. It's it's a part of our DNA.

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Melinda Lee: Yeah, yeah, I mean, that's invaluable, right? Because they're getting. There's if they're a smaller financial institution or medium sized financial institution. They are getting the breadth, the depth and breadth of your experiences. Your team's experiences and knowledge.

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Melinda Lee: said, carried the burden of these regulations on their backs.

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Kevin Oden: Exactly that, and that. And that's exactly right, especially when you're talking about smaller institutions. There, you may have, you know, a cro, or a Cfo or CEO who has experience.

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Kevin Oden: with that institution, but actually hasn't seen the broad breadth of, you know, regulatory oversight because their Institute. Sometimes they've grown up with their institution. They've seen it go from a 700 800 million dollars asset to, you know, a billion to 2 billion to 3 billion. But they haven't, and that regulatory oversight

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Kevin Oden: increases with the size of your assets under management as well as with the complexity, the growing complexity of your firm.

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Melinda Lee: Wait!

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Kevin Oden: And so if you haven't, you have yet. If you haven't been there before, you haven't done it before, you'd like to bring in somebody and have the advice of somebody who has done it before.

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Melinda Lee: Right? Right? I mean. And this brings me to just a deeper level question. So it sounds like, you say these large institutions are coming in. They have the big name. Consulting firms have this big name, and they, for they're maybe perceived as the best. But then they bring in, and they're bringing in lower level or not inexperienced, not as experienced people

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Melinda Lee: actually do the job. So at a smaller scale, can you think about a time when you actually met somebody who's coming in.

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Melinda Lee: and they may be perceived, as you know. I know it all, or they portray themselves as I know it all. And then actually, when you dig a little deeper, they don't, they may blow up. They have bad behavior. Can you spot them early on? I mean, you probably met a lot of people. Now.

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Kevin Oden: No, I've I've I've lived through that experience myself. Unfortunately.

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Melinda Lee: Yeah.

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Kevin Oden: Where, you know. Again we hired an unnamed firm to to help us years ago, and this is, you know, nearly a decade ago, if not more now. But you know, I've lived through that experience where basically

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Kevin Oden: you, they start to give advice. They start to give. You know documents, etc. And you start to read. You read through them and you get, you know you get a sense that

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Kevin Oden: well, one I wouldn't do this. Second, it flies in the face of what we know is regulatory oversight, because there's a body of so you can spot them pretty quickly. If you have, if you have experience, if you have experience.

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Melinda Lee: Got it. That wouldn't. Yeah, that's interesting, right?

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Kevin Oden: No.

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Melinda Lee: Yeah, well, what if someone does?

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Kevin Oden: If you don't spot them. If you, if you don't have experience, you, you're gonna have a difficult time spotting them. And you know, because you're like, I said, for smaller institutions. They're relying on these individuals to.

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Melinda Lee: Yeah.

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Kevin Oden: More or less, educate them.

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Melinda Lee: Right, right, right.

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Kevin Oden: Okay, so.

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Melinda Lee: So so maybe have someone else with you.

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Kevin Oden: I mean. And so it's, you know, like I said, if you have.

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Kevin Oden: if you have experience, or if you have people on your team that have deep experience. Then those you know you can spot these these individuals. It's when you. It's when you don't have, and especially these smaller institutions, where, in some cases

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Kevin Oden: in particular businesses, you may be a 1 person shop. You may have to run a whole division by your by yourself. More or less and it becomes very difficult to to maintain that level of expertise in house, because as soon as people in some cases get that expertise. They look to go to a bigger firm where they can get more money.

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Melinda Lee: right?

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Melinda Lee: Yeah, and so I mean, let's talk about your team and how your team can come support them.

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Kevin Oden: Yeah, so my team. I've been very fortunate.

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Kevin Oden: with you know, assembling my team. So just about everyone on my team I've worked with for a decade or more, so I've been able to to gather them from my my past past employers, as well as you know, along the way, working with them in various other positions. So when you think about the people on my team, I have one individual. So this is

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Kevin Oden: emblematic of just about everyone on the team. But you know, just to pick on one particular individual. He's worked at the Federal Reserve Board. He's worked at Fannie Mae Phd. In economics. He's worked at Wells, Fargo. He's worked. He was a

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Kevin Oden: private consultant for a while. He was the Cro. Of a small of a small firm, and you know I've known him for nearly 20 years and worked with him

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Kevin Oden: prior to this, for you know, 7 or 8 years directly.

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Kevin Oden: So, you know, when you have people like that, you know, they you know they can do. They can walk the walk, you know, and you know they they've seen.

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Kevin Oden: They've seen how to work through issues. They've seen how to work through, you know, work with various Regulators, whether it be the Federal reserve board, the Fdic, the Occ, and in most of our team's case not everyone, but most of our team's case. They they've also worked with overseas regulators. Whether it be Osfi in Canada.

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Kevin Oden: or you know the Eba in Europe as well. So lots of familiarity with, you know, regulatory context

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Kevin Oden: as well. In in not just regulatory context from reading, but from actually having to live and breathe it every day.

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Melinda Lee: Right right. And what are the difficult conversations that you need to have when it comes to.

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Kevin Oden: Yeah, well, there are really the the most difficult conversations I have are with with clients that are

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Kevin Oden: skirting, or, let's say, skating on the boundary, or just below the boundary of sort of regulatory requirements, you know, as a financial institution. Should you be well above that regulatory boundary, absolutely not

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Kevin Oden: be crazy, because you know your your goal is to

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Kevin Oden: your goal is to return, you know, profits to investors and protect your your clients. in the most efficient way as possible. So I'm never going to advocate for anyone to go

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Kevin Oden: far and above the regulatory requirements. But my toughest conversations are when I walk in, and I see people sort of just below that boundary, and I have to tell them. Look, I can't tell you to move above can't tell you you have to change this fix that do this.

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Kevin Oden: but I would recommend it because I've seen what happens to some financial institutions, not all that are in your position that are missing this piece of the regulatory guidance that are missing that function that's required. And sometimes these institutions get fined. They get put in the penalty box.

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Kevin Oden: but some others don't. Because it really depends. I I always tell clients that. You know, regulations

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Kevin Oden: universal. But examinations are always local, because an examiner needs to come in and apply those regulations, and they all apply them a little bit differently.

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Melinda Lee: Right.

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Kevin Oden: So you may be fine. You may be absolutely fine, but I need to tell you what I see relative to you know the written rule.

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Melinda Lee: Right.

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Kevin Oden: Those are the toughest conversations.

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Melinda Lee: Yeah. How do you prepare for it?

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Kevin Oden: Oh, it's

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Melinda Lee: Yes.

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Kevin Oden: It's it's simple. I you know I fret and moan and

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Kevin Oden: And then I get my gumption up, and you know it's you. You never really get used to it.

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Melinda Lee: Yeah.

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Kevin Oden: But you you have to. You have to be honest. It's a matter of being honest with your clients. It would be easy for me to say, Yeah, you know everything's fine, but then it that that would damage the our reputation, my reputation, if and when the Regulators came in.

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Melinda Lee: Yeah.

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Kevin Oden: And or internal audit even said, You know, look, this is this is not right. This is not working so I've got to be honest. And sometimes, to to be perfectly candid.

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Kevin Oden: if I'm handing over a written document to them outlining

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Kevin Oden: the I've this. This goes to the second part of the toughest piece of the conversation.

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Kevin Oden: you know. Sometimes they they'll say, Please don't put this in here.

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Kevin Oden: this this recommendation in there, and I will tell them I have to, you know. Now you again. You can choose to not do it, but I have to put it in the document, because if someone comes in and sees our work.

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Melinda Lee: Right.

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Kevin Oden: They're going to, you know. They're going to judge it, based on, you know, on on the on the written regulations.

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Kevin Oden: And they're going to say, this guy, you know, this guy's firm is horrible. They missed some obvious things right.

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Melinda Lee: And then do they comply? Do are they.

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Kevin Oden: Oh, they have to. Yeah, I said, you know, this is the document. I'm gonna keep a copy of it.

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Kevin Oden: Yeah.

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Melinda Lee: Wow!

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Melinda Lee: That is tough. That is.

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Kevin Oden: But it's, you know. Look, that that doesn't happen frequently. I.

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Melinda Lee: Right.

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Kevin Oden: It. It does happen probably once a year. If sometimes twice. But you know that's sort of a 1 1, you know. One time a year thing.

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Melinda Lee: hmm, well, I, I know, I mean, it sounds like your approach that just to be honest, yeah, and just have those conversations.

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Kevin Oden: You have to have a tough conversation.

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Melinda Lee: Yeah, have the tough conversations, even though they're tough.

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Kevin Oden: Yeah.

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Melinda Lee: Yeah.

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Melinda Lee: I love it. And I think that I mean, I could see where you're so successful and why you're so successful just because you have all this experience. You have an amazing team.

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Melinda Lee: and you just having that also approachability about you to be able to have those candid conversations.

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Kevin Oden: I appreciate that.

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Melinda Lee: Yeah, it's like an open door to. Yes, even though we're gonna have a difficult conversation, I still feel at least I can have it with you right? And we can talk about things.

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Kevin Oden: That's that's, you know, reinforcement. That's that's good. That's my next tough conversation. You're building up confidence for me.

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Melinda Lee: Yes, there you go.

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Melinda Lee: Well, I really appreciate it, Kevin. So as we wrap up. Can you share with us? What is that one leadership, golden takeaway that you want the audience to remember.

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Kevin Oden: It's very simple. The every day you lead by example, whether it's a positive example or a negative example. Leaders have to realize

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Kevin Oden: when you walk into the door. You're leading by example. So you want to make those examples as as positive as possible for your team, so that you know they, too, can lead in a in a positive way, and it doesn't mean that every day is going to be, you know. Rose colored in beautiful you know you have the tough conversations, too. But

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Kevin Oden: You're setting an example, whether you you know whether you know it or not. As a leader every moment, every you know, every minute of every day.

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Melinda Lee: I agree, I agree. And so the best leadership trait is to right lead by example, be.

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Kevin Oden: Lead, by example.

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Melinda Lee: No worries.

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Kevin Oden: Bring your best self to work every day.

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Melinda Lee: Yeah. And if it's not, then it's okay. But at least you communicate that. You let people know.

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Kevin Oden: Exactly.

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Melinda Lee: Yeah.

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Kevin Oden: I mean open communication.

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Kevin Oden: good, positive communication. Is a part of leading by example, right? So you know, there should be no surprises at work. From a leadership perspective.

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Kevin Oden: right? Right? And people will go the mile with you, even if you're not having a good day.

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Kevin Oden: Yeah.

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Melinda Lee: But at least they know who you are, at the heart of who you are.

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Kevin Oden: Exactly.

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Melinda Lee: Yeah.

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Kevin Oden: But I think that's if I had to

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Kevin Oden: to have one takea leadership takeaway. That that would be it.

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Melinda Lee: That would be it.

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Melinda Lee: Yeah, because we've all had those leaders where it was. Just so it's unpleasant to be around them.

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Kevin Oden: I've lived through a leader like that and Short lived. I ended up leaving after 3 months, because this leader literally would come out of his office every day and find someone to berate, you know, or humiliate in front of everyone, and that was sort of like his goal. And then he'd go back into his office, slam the door, and

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Kevin Oden: so I, after about 3 months, I decided I can't. I can't. I can't work like this can't live like.

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Melinda Lee: Good for you. Good for you. Right? That's a leadership trait, too, to know exactly when it is to just cut it off.

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Kevin Oden: Just cut it off and move on.

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Melinda Lee: Right? I mean, that does not. It's horrible to live in that area. Hopefully, there's yeah, he's learned, or he's evolved from that place.

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Kevin Oden: Heard he was fired about a year later, so.

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Melinda Lee: Because we gotta learn the hard way.

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Melinda Lee: Oh, my goodness, well, thank you so much, Kevin. It was really fun. I learned a lot about risk management or just understanding how to look out for different risk consultants and just the different people that are out there in general right, who are portraying themselves as one way, but really somebody else. And it behooves us to really take a moment to take a step back.

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Melinda Lee: really dig deep, get curious, maybe bring in some other people to help us decipher what to do.

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Melinda Lee: And if you're a financial institution and you're looking for some financial risk, consulting compliance, consulting. I encourage you to reach out to Kevin D. Oden, and associates. We'll have his contact information down below in the comments below.

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Melinda Lee: and really appreciate you, Kevin, so much.

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Kevin Oden: I appreciate the the invite and thank you.

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Melinda Lee: Thank you and thank you audience, for being here. I trust that you got your leadership, golden takeaway for the day. I encourage you to implement it. And remember, anytime you have a conversation with somebody. You also have an opportunity to connect, to inspire, and to make a positive difference in your communities. Thank you again until next time. I'm your sister in flow.

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Melinda Lee: Bye, bye.