Independent Testing and Audit Services
Our testing and audit services give fintechs a clear view of how their compliance programs actually perform. We review policies, processes, and records to confirm they operate as intended and align with regulatory expectations. In many cases, these reviews are requested by regulated partners, like sponsor banks, who require independent testing so fintechs can demonstrate oversight and provide documented results.
The Basics
What Are Testing and Audit Services?
Testing and audit services involve reviewing how well your compliance program is working day to day. These reviews are often performed in response to specific requests from regulated partners, like sponsor banks, who require independent verification of certain controls or processes.
For fintechs, this means regularly evaluating how customer onboarding, transaction monitoring, supervision, and reporting processes perform in real life. Regulators expect documented evidence that your compliance controls are active, effective, and reviewed by someone independent from daily operations. Regulated institutions frequently require similar independent testing to confirm that fintech programs meet their oversight standards.
Testing provides real insight into how your compliance program actually operates, not just how it’s written on paper
Regulators expect documented evidence that your compliance controls are tested and reviewed regularly
It helps identify gaps or weak controls early, before they become regulatory issues or partner concerns
Testing supports continuous improvement by tracking whether past findings have been corrected
ndependent audits strengthen credibility with banking partners, investors, and regulators
Regular testing builds confidence that your compliance program can adapt as your products, vendors, and risk profile evolve
Risk-Based Testing
Testing frequency and scope should match your level of risk. High-risk areas, such as AML or marketing compliance, should be reviewed more often.
Documented Methodology
Examiners expect written testing plans with clear details: what was tested, when, by whom, and what was found. When testing is requested by a sponsor bank or regulated partner, the scope typically follows the checklist or control areas they provide.
Ongoing Reviews
Testing is not one-time. Regulators and partners expect continuous or periodic reviews throughout the year, not just annual check-ins
Three Lines of Defense
Regulators look for separation between daily operations, compliance monitoring, and independent audit oversight
Remediation Tracking
Findings must be documented and followed by corrective actions with proof that the issues were resolved
Regulatory Expectations
What Regulators and Partners Expect from Testing and Audit Programs
Regulators and partners want evidence that your compliance program is active, tested, and risk-based. In bank-fintech partnerships, sponsor banks often provide a list of specific areas that must be independently tested so they can review the results as part of their oversight obligations.
Mistakes
Common Mistakes in Compliance Testing and Audits
Treating testing as a one-time task instead of an ongoing process
Reviewing documents but not checking how systems actually work in practice
Failing to record what was tested, when, and what was found
Testing all areas equally instead of focusing on higher-risk activities
Having the same individual who manages certain functions also conduct the testing
Not following up on findings or tracking whether issues were fixed
Missing new regulatory requirements or partner expectations when defining the testing scope
Scenarios
Examples of Testing Gaps in Fintech Compliance
Here are some common situations where fintechs run into trouble because their testing programs don’t reflect how their business actually operates. In each case, targeted, risk-based testing could have helped prevent findings or delays.
Scenario 1
A money transmitter conducted annual AML reviews but never tested its vendor’s customer screening system.
The vendor missed multiple sanctioned names, and the firm couldn’t demonstrate oversight to its banking partner.
At InnReg, we’d add independent screening tests, document system checks, and create a testing calendar tied to vendor performance reviews.
Scenario 2
A broker-dealer relied on internal staff for testing, who were also responsible for daily compliance tasks.
FINRA noted a lack of independence during an exam, leading to additional scrutiny of supervisory controls.
At InnReg, we’d provide independent second-line testing support, separating daily operations from review functions to align with regulatory expectations.
Scenario 3
A crypto platform updated its onboarding flow but never tested the new KYC rules before launch.
Several accounts bypassed key verification steps, triggering alerts from a partner bank.
At InnReg, we’d perform targeted KYC testing before and after product changes, documenting results and approval steps for partner reviews.
Scenario 4
An RIA conducted annual mock audits but didn’t track whether past issues were fixed.
During an SEC exam, repeat deficiencies were found because there was no evidence of remediation.
At InnReg, we’d build a findings tracker, assign owners to each issue, and test the corrections during the next review cycle.
How We Help
Our Approach to Testing and Audit Services
We provide independent testing and audit services that evaluate how fintech compliance programs operate day to day. Our reviews examine policies, operational processes, and supporting records to verify that controls work as intended. The results provide documented evidence that fintechs can share with regulators, sponsor banks, and other partners
We Start with a Risk Assessment
We review your products, customer base, and risk profile to design a testing plan that focuses effort where it matters most.
We Conduct Independent Reviews
Our team performs objective testing across your compliance areas, including AML, KYC, transaction monitoring, and supervision. When a partner bank requests testing, we align our review with the control areas and requirements they specify.
We Document Everything Clearly
We create testing reports that outline scope, samples, findings, and corrective actions. These reports can be provided directly to your partner bank or regulator as documented evidence that independent testing was completed.
We Track Findings and Follow Up
We help you assign owners to each issue, document remediation steps, and test again to confirm corrections were made.
We Work Within Your Systems
Whether you use Asana, Notion, or another platform, we fit into your workflow to manage tasks and updates efficiently.
Our Team
Meet the Team Supporting Independent Testing and Audit Services
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FAQ
Frequently Asked Questions
What are testing and audit Services?
How often should we perform compliance testing?
Do regulators require testing and audits?
Can my internal compliance team handle testing?
What kind of issues do testing and audits usually uncover?
What does InnReg deliver after a testing engagement?
Contact Us
Let’s Talk About Your Testing and Audit Needs
If your compliance program needs an independent review, it may be time to bring in outside support. Here are common situations where fintechs benefit from independent testing or audits:
You’ve grown fast and haven’t updated your testing plan in over a year
A regulator or partner asked for evidence of independent testing
You’re unsure whether your compliance reviews cover all key risk areas
Past testing findings haven’t been tracked or retested for follow-up
Your sponsor bank or regulated partner asked for an independent audit and provided a testing checklist
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