Financial Crime World

Risk-Based Approach to Anti-Money Laundering (AML) in Saint Helena

The Financial Services Regulatory Authority (FSRA) of Saint Helena has introduced a risk-based approach to Anti-Money Laundering (AML) regulations to strengthen its efforts against money laundering (ML) and terrorist financing (TF).

Overview

The new handbook outlines the requirements for financial institutions operating in the territory, adopting a two-tiered risk assessment approach. This approach aims to reduce the risk of ML and TF while minimizing unnecessary compliance costs for financial institutions.

Risk Assessment Approach

  • The FSRA will conduct an overall business risk assessment at a macro/county level, taking into account relevant risks and risk factors.
  • Each entity under the Companies Registry’s management will undergo a separate client risk assessment, including risk weighting of all relevant risk factors.

Key Aspects of the New AML Regime

Customer Due Diligence (CDD)

  • Financial institutions must identify and verify the identity of natural persons and legal entities
  • Enhanced due diligence measures for politically exposed persons (PEPs) and connected persons involved in financial transactions
  • Simplified CDD measures for listed entities or regulated entities in other jurisdictions

Third-Party Reliance

  • Customer screening and monitoring requirements
  • Transaction monitoring and reporting suspicious transactions to the Money Laundering Reporting Officer

Employee Screening and Training

  • Emphasis on employee screening and training
  • Record keeping and monitoring requirements

Benefits of a Risk-Based Approach

By adopting a risk-based approach to AML, Saint Helena aims to:

  • Reduce the risk of ML and TF
  • Minimize unnecessary compliance costs for financial institutions
  • Enhance the territory’s reputation as a financially stable and secure jurisdiction

The new regime is expected to strengthen Saint Helena’s efforts against money laundering and terrorist financing, while also promoting a more efficient and effective AML compliance environment.