Rising reliance on internal auditors spooks regulators and industry

Risk managers warn US is substituting supervisors with auditors; could compromise independence

As the three US prudential agencies narrow their supervisory remits and shrink headcounts, both regulators and risk professionals warn bank supervision could become too reliant on the work of internal auditors. That may in turn mean more pressure on audit teams from the business units. 

“Everyone pays lip service to audits being independent, but the reality is that anytime audit has findings, there