Can you guess the current number of regulatory restrictions in the US? While you would probably guess a large number, the exact number is unknown. The task of computing an exact number is so time consuming and difficult that even the experts can only estimate the number relying on artificial intelligence and alternative approaches.
One approach developed by the Mercatus Center at George Mason University estimates that between 67,000 and 170,000 individual regulatory restrictions (depending on which measurement methodology they used) applied to depository institutions alone in 2017. While the number is probably not 170,000 for any one bank, you can imagine that the number is minimally in the tens of thousands.
All of those restrictions create “compliance risk” for impacted organizations. Compliance risk is the risk of legal or regulatory sanctions, financial loss, or damage to reputation resulting from failure to comply with the laws, regulations, and rules applicable to the organization. If the organization is unaware that they need to comply with the restriction; or if adequate controls are not in place addressing the restriction, the organization is exposed to compliance risk.