Ghana’s Financial Watchdogs: BoG and FIC Issue New Guideline on AML/CFT Compliance for Banks and Financial Institutions

The Bank of Ghana (BoG) and the Financial Intelligence Centre (FIC) have released a new guideline to help banks and non-bank financial institutions in Ghana implement effective Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) and Proliferation of Weapons of Mass Destruction (P) compliance programs. Here’s a brief overview of the guidelines.

Contents

1. Foreword
2. Purpose and Overview of the Guideline
3. Key Elements of the New Guideline
   • Institutional Policy Framework
   • Customer Due Diligence (CDD)
   • Reporting of Suspicious Transactions
   • Training and Education
   • Anti-Money Laundering Reporting Officer
   • Cooperation with Competent Authorities
   • Risk Assessment

Foreword

Ghana’s financial sector has experienced significant growth in recent decades, leading to increased cross-border activities and financial intermediation. While these developments have numerous benefits, they also pose challenges, particularly in the realm of money laundering and terrorist financing. In response to these threats, the Bank of Ghana and the Financial Intelligence Centre have collaborated to issue this guideline for licensed financial institutions.

Purpose and Overview of the Guideline

The purpose of this guideline is to help financial institutions understand and comply with the legal requirements and obligations imposed by the Anti-Money Laundering Act, the Anti-Terrorism Act, and related regulations. The document also serves as a resource for implementing AML/CFT policies and procedures effectively.

Key Elements of the New Guideline

Institutional Policy Framework

Each financial institution must:

• Adopt and implement policies
• Assess their ML/TF risks
• Have internal rules, procedures, and controls

Customer Due Diligence (CDD)

Financial institutions must perform CDD procedures to determine the true identity of their customers and investigate the source of funds involved in transactions. They should also:

• Establish risk profiles
• Maintain records of their CDD efforts

Reporting of Suspicious Transactions

Financial institutions must report suspicious transactions and maintain records of such reports. They should also understand:

• Thresholds for reporting
• The timeframe for reporting

Training and Education

Financial institutions should provide training and education programs for all staff and:

• Ensure all employees recognize and report suspicious transactions
• Maintain records of training and education activities

Anti-Money Laundering Reporting Officer

Each financial institution is required to appoint an Anti-Money Laundering Reporting Officer responsible for their CFT compliance program. Some key responsibilities are to:

• Develop comprehensive AML/CFT policies and procedures
• Vet suspicious or unusual transactions
• Coordinate staff training

Cooperation with Competent Authorities

Financial institutions must cooperate with competent authorities by providing information and access to relevant records when requested. They should also ensure prompt responses to authorized requests, maintaining the security and confidentiality of such requests.

Risk Assessment

Financial institutions are encouraged to conduct regular risk assessments, which includes:

• Aligning their AML/CFT risk management with their overall risk management control function
• Determining overall risk levels
• Implementing appropriate risk mitigation measures

Conclusion

The new guideline provides crucial information for banks and financial institutions in Ghana to effectively combat money laundering and terrorist financing, ensuring a transparent and responsible financial system that benefits the nation and its people. Financial institutions are tasked with diligent implementation of the guidelines to minimize their risks and protect their reputation.