Risk-Based Approach to AML in Hungary: K&H Bank Zrt Takes Precautions
In a bid to prevent money laundering and terrorist financing, K&H Bank Zrt has implemented a robust risk-based approach to anti-money laundering (AML) in Hungary.
Prevention of Money Laundering and Terrorist Financing
K&H Bank Zrt recognizes the significant risk posed by these criminal activities and has established a program for AML prevention to mitigate this risk. Under the Hungarian Act No: LIII of 2017 on Prevention and Combating of Money Laundering and Terrorist Financing, the bank is required to prevent the laundering of proceeds from criminal activities through its financial system.
Measures Implemented
- Identifying and verifying customer identities
- Monitoring transactions for suspicious activity
- Reporting any findings to the relevant authorities
Client Due Diligence
K&H Bank Zrt performs thorough client due diligence on all new customers, including:
- Verifying their identity
- Checking their background against sanctions lists
- Screening customers against:
- European Union’s sanctions lists
- UN Security Council’s sanctions lists
- Monitoring for any changes in customer information
Transaction Monitoring
The bank continuously monitors transactions for suspicious activity using an automatic system to flag potential issues. Transactions are analyzed against customer profiles and any discrepancies are reported to the Financial Intelligence Department responsible for combating money laundering and terrorist financing.
Employee Training
To ensure that all employees understand their role in AML prevention, K&H Bank Zrt provides regular training sessions on:
- Recognizing suspicious activity
- Reporting it to management
- Client due diligence procedures
- The importance of monitoring transactions
Audit and Compliance
The bank’s Internal Audit Directorate regularly checks the fulfillment of its standard conditions and procedures for preventing money laundering and terrorist financing. The Compliance organization is responsible for reviewing compliance with regulations, focusing on accurate performance of client due diligence procedures and reporting findings to top management and shareholders.
Embargo Screening
K&H Bank Zrt screens all clients, transactions, and SWIFT messages against applicable lists to ensure compliance with EU, UN, and OFAC requirements. This includes screening against sanctions lists and reporting any findings to the relevant authorities.
Conclusion
By implementing a robust risk-based approach to AML prevention, K&H Bank Zrt demonstrates its commitment to preventing money laundering and terrorist financing in Hungary. The bank’s measures are designed to identify and prevent suspicious activity, while also ensuring compliance with relevant regulations and reporting requirements.