Financial Crime World

Money Remittance Institutions Must Strengthen AML/CFT Controls to Combat Money Laundering and Terrorist Financing

As part of ongoing efforts to prevent money laundering (ML) and terrorist financing (TF), the [Country] government has issued new guidelines for money remittance institutions to strengthen their Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) controls. These guidelines aim to enhance transparency, prevent financial crimes, and protect the integrity of the financial system.

Senior Management’s Key Roles

Senior management is responsible for implementing and managing AML/CFT compliance programs in accordance with policies and procedures established by the board, as well as requirements of the law, regulations, and industry standards. Specifically:

  • Awareness of ML/TF Risks: Senior management must be aware of and understand the ML/TF risks associated with business strategies, delivery channels, and geographical coverage.
  • AML/CFT Policy Formulation: They must formulate AML/CFT policies that reflect the institution’s risk profile, nature of business, and size of operations.
  • Proper Implementation of Procedures: Senior management must ensure proper implementation of AML/CFT procedures, including:
    • Customer Due Diligence (CDD)
    • Record keeping
    • Ongoing due diligence
    • Reporting of suspicious transactions
    • Combating the financing of terrorism

Compliance Officer’s Duties

The Compliance Officer plays a critical role in ensuring the institution’s compliance with AML/CFT requirements. The officer must:

  • Ensure Compliance: Ensure that the institution complies with AML/CFT requirements.
  • Implement Procedures and Control Mechanisms: Implement proper AML/CFT procedures and control mechanisms.
  • Assess Effectiveness: Regularly assess the effectiveness of the AML/CFT mechanism to address changing ML/TF trends.
  • Secure Communication Channels: Secure channels of communication from employees to branches, subsidiaries, and agents.
  • Employee Awareness: Ensure that all employees are aware of the institution’s AML/CFT measures.

Employee Due Diligence Procedures

Money remittance institutions must establish employee assessment systems that evaluate an employee’s personal information, including:

  • Criminal records
  • Employment history
  • Financial background

The system must be commensurate with the size of operations and risk exposure to ML/TF.

Employee Training and Awareness Programs

Institutions are required to conduct regular awareness and training programs on AML/CFT practices and measures for employees. Refresher trainings must also be conducted regularly to ensure ongoing employee awareness and understanding of AML/CFT requirements.

By strengthening their AML/CFT controls, money remittance institutions can help prevent financial crimes and protect the integrity of the financial system.