Voices in Risk Management

Operational Risk at Texas Capital Bank

I provide risk management oversight for Texas Capital Bank and its subsidiaries through the implementation of a comprehensive operational risk program. This includes providing direct oversight for the bank’s operational risk, fraud risk, model risk, business resiliency, crisis management, and disaster recovery functions. Texas Capital Bank’s operational risk program also encompasses data risk management, third-party risk management, and technology and information security risk, along with corporate and executive security and human capital risk.

Responsibilities as Texas Capital Bank’s Head of Operational Risk

I am responsible for managing several traditional operational risk areas, including risk metrics, losses, event analysis, program and policy components, and dimensions of fraud investigations. Additionally, my role has increasingly focused on technology and information security risk, model risk management, business resiliency and disaster recovery, and third-party risk and resiliency.

Today’s Top Operational Risks

Information security and cyber risks pose tremendous threats, not only for the financial services industry, but for many public and private sectors. Fraud risk is a very close second, as fraud schemes are constantly growing and evolving, and perpetrators are becoming more skillful.

The transition toward digital consumer and commercial transactions that reached critical mass during the pandemic has created more opportunities and avenues for fraudulent activity. People used to carry their personal information (i.e., credit cards, IDs) in a wallet. Now their financial information is on file with scores of merchants, websites, and providers, which significantly increases the potential for fraud and loss of information. It’s quite common to read about cyberattacks or data exposures in the news. Through these exposures, personal information can become available for purchase in places like the dark web, Telegram, and other avenues where bad actors can obtain it. With that in mind, it’s critical that we all remain on high alert.

Another top risk is the human capital risk related to retaining and hiring talent. We need people who bring skill sets from risk and business standpoints to our organizations. Across the industry, risk managers are a top-priority role.

Balancing In-Person and Remote Work

Our employees are excited about Texas Capital Bank’s tremendous transformation, and they enjoy collaborating in the office to achieve our goals as a firm. We continue to meet our employees and prospective employees where they are, providing flexible working arrangements that help them balance the work/life continuum. Meanwhile, the economy has driven risk-related wages significantly higher than before, perhaps due to institutions in large cities having roles that can be performed remotely. That makes organizations evaluate what we are paying and how we are performing compared to the market. Companies that haven’t yet started to think about this are behind the eight ball.

Early Days; Learning the Value of Hard Work at Home

I grew up in a small town in central Pennsylvania. It was, and remains, economically disadvantaged due to the area’s loss of jobs in the steel production industry. I am the youngest of three children raised by a single mother who valued education and her children’s futures. She worked as an oncology and hospice nurse, picking up as many extra shifts as possible to make ends meet. She went back to school in her 40s and earned a master’s degree in nursing administration to advance her career and move our family to Pittsburgh. I learned the value of hard work from her.

With my mother working long hours, my siblings and I learned how to cook at a very young age. That was always our deal: The kids cooked, and our mom washed the dishes when she got home from work. My earliest memories are from when I was 4 to 7 years old, making homemade strombolis or pizza, soup, and anything else that was cheaper than ordering out. I still make these meals today and have passed down those cooking experiences to my two boys (ages 9 and 12). Since moving from Pennsylvania to Texas, I have also learned how to make Texas barbecue. My first lesson was that “barbecue” doesn’t mean hot dogs and hamburgers.

Growing up without financial stability made me focus on what I didn’t have and what I could have. As a person who managed his mother’s budget starting in middle school, business and personal finance has always been a passion of mine. Early in my career, I thought I was going to be a Wall Street analyst and part of the New York scene—until I met my wife and fell in love. She and I met in a training class and the rest, as they say, is history!

How a Risk Role Ties to a Lifelong Interest in Investing and Finance

I have always enjoyed having a role in quantitative, datadriven decisions and executing in a high-risk, high-stakes environment. Risk provides these opportunities and experiences. Whether your organization is investing in a strategic initiative or rolling out a new product or service, the decision must be data-driven, fact-based, and measured from a risk tandpoint so you can determine what your return should be. Risk can identify the right controls and processes to reduce expenses and create a better client experience.

Teaching

Today I hear a lot of discussion related to youth work ethic: “They don’t work as hard as we did.” But I see an incredible thirst and hunger for knowledge from my experiences in teaching personal finance and other collegiate courses. Young people genuinely want to know what to do, how to do it, and they aren’t jaded by years of work in an industry or firm. Their excitement to learn how to do things makes me excited to teach them—and to share lessons in personal and corporate finance to help them avoid the mistakes I or others have made.

I bring learning and teaching with me everywhere I go, whether it’s educating a bank executive on inherent versus residual risk or educating a regulator on a process at the bank. Teaching is an element of effective communication, which is something we need in all facets of our careers whether we are in the first, second, or third line of defense.

Mentorships

The informal mentorships and relationships I have built with people throughout my career have been truly invaluable. Being an advocate for someone, and having an advocate for yourself, will change your life experiences— and your life.

“ The informal mentorships and relationships I have built with people throughout my career have been truly invaluable.”

Your Inner Circle

It’s a common saying: “You are as smart as the five people you keep closest to you.” You should look around and be sure you’re not the smartest person in your circle—and if you are, you should find new friends or mentors! You pick up the standards, approaches, words, phrases, and mannerisms from the people in your environment. We have all “boiled the ocean” a time or two in our careers. You are a part of your habitat. It’s important to surround yourself with people who will push you to become better.

Last Year’s Launch of Texas Capital Securities

I was personally excited about our investment banking launch as it took me back to my roots as a capital markets manager at PNC. I was able to help guide and advise our new business on the risk protocols, procedures, and programs as we launched. It was rewarding to help our experienced leaders at Texas Capital implement a strategy that made us the only full-service financial services firm founded and headquartered in Texas. There are not many places you can go in Dallas to find a trading desk, but Texas Capital Bank is one.

Texas Capital Bank’s Veterans and mployees Together Resource Group

I am the executive sponsor for our veterans employee resource group. We partner with Carry the Load, Patriot PAWs, The Boot Campaign, National Cemeteries across the state, and non-profit and other veterans’ services organizations in Texas. I especially enjoy the week of Veterans Day when I travel across our markets and celebrate our veterans and their families in a different city each year. Last year, I ran my first 5K with our San Antonio team. see the group as fulfilling our obligation to American service members. I was not in the military, but my father, grandfathers and uncles were, and I feel strongly that the commitment and sacrifice of all who served should be honored and celebrated.

Pittsburgh to Texas

Making the decision to join Texas Capital Bank allowed me to rebuild a risk organization—to envision and create what the organization could be and will continue to be after I am gone. I am not a person who enjoys sailing a boat that’s already afloat and on the sea. I want to build it and craft it with others around me. And with top companies moving to Texas and the economy thriving, Texas is an exciting place to be. Compared to cold and wet winters in Pittsburgh, the weather isn’t bad, either!

Professional

Texas Capital Bank

Dallas, Texas

Managing Director, Head of Operational Risk

2019-present

PNC

Pittsburgh, Pennsylvania

Several roles, including Capital Markets Manager and culminating with Senior Vice President, C&sIB Operational

Risk Manager

2006-2019

Point Park University

Pittsburgh, Pennsylvania

Professor, School of Business (focusing on personal finance)

2017-present

Education

Duquesne University

Pittsburgh, Pennsylvania

BSBA, Finance, Investment Management

Robert Morris University

Moon Township, Pennsylvania

MBA, Finance

Community

Executive Sponsor

Texas Capital Bank Veterans and Employees Together Resource

Group (VET)

Voices in Risk Management celebrates the diversity of experience, background, and skill that is driving the best risk management practices of today.

*. The comments have been edited for length and clarity.