Central Bank Introduces Risk-Based Supervisory Framework to Enhance AML/CFT Compliance

The Central Bank has launched a risk-based supervisory framework aimed at ensuring that financial institutions comply with Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulations. This new framework is designed to enhance AML/CFT compliance and promote financial stability, soundness, and prevent financial crime.

Monitoring and Enforcement Actions

The level of supervisory engagement will be determined by the institution’s AML/CFT risk rating, with higher-risk institutions facing more intense monitoring and enforcement actions. These measures include:

On-site examinations: full scope, limited scope, follow-up, consolidated, and thematic reviews
Self-assessment questionnaires
Desk-based reviews
Review of board minutes and papers
Assessment of internal and external audit reports

Enforcement Powers

The Central Bank reserves the right to take firm and appropriate enforcement actions when necessary, including:

Criminal sanctions
Administrative sanctions
Power to remove directors
Issuance of compliance directions
Restriction/revocation of licenses
Written warnings

Communication with Financial Institutions

In cases where deficiencies are identified, the Central Bank will communicate clearly with financial institutions, outlining:

The materiality of the deficiencies
Supervisory expectations
Remedial action required
Timelines for completion

Risk-Based Approach

The Central Bank’s risk-based approach ensures that institutions are held to a standard commensurate with their level of risk. This framework is designed to:

Promote financial stability and soundness
Protect depositors and policyholders
Prevent financial crime
Monitor compliance with AML/CFT requirements

Learn More

For more information on the Central Bank’s AML/CFT Risk-Based Supervisory Framework, visit our website at www.central-bank.org.tt.