Policy Statement on Supervision of Financial Institutions’ Compliance

Overview

The Bank of Thailand (BOT) has issued a policy statement outlining the requirements and responsibilities for compliance functions within financial institutions. This statement aims to ensure adherence to laws, rules, and regulations.

Key Points

• Resources: Compliance staff should have proper qualifications and a sound understanding of compliance laws, rules, and their practical impact on operations.
• Duties and Responsibilities: The compliance unit should advise senior management and staff on compliance matters, conduct risk assessments, and ensure adherence to regulations.

Roles and Responsibilities

Internal Audit Unit

• The internal audit unit is responsible for reviewing the scope of work and auditing the performance of the compliance unit.

Risk Management Unit

• The compliance unit and risk management unit should coordinate closely to enhance compliance efficiency.

Business Unit

• The compliance function should inform business units about any amendments or changes in compliance regulations.

External Units

• Compliance units may coordinate with external units, such as the Bank of Thailand, Stock Exchange of Thailand, Office of Securities and Exchange Commission, auditor, etc., to submit reports as required by relating regulations.

Reporting Requirements

• Within 90 days from the year end date or within 30 days from the date of the Board’s first meeting held in that year.
• Promptly report any case found and proved to be non-compliance, with a report on corrective actions submitted within 15 days after completion.

Cross-Border Issues and Outsourcing Requirements

• Financial institutions conducting business internationally must comply with local laws and regulations in all jurisdictions where they conduct business.
• Outsourcing specific tasks of the compliance function is allowed, but the service provider cannot have involvement in senior management or benefits to avoid conflict of interest.