Financial Crime World

Here is the converted article in Markdown format:

Waystone Takes Proactive Approach to Managing Financial Crime Risks

Luxembourg-based investment fund manager Waystone has outlined its comprehensive approach to managing financial crime risks in a new policy document. The firm emphasizes its commitment to identifying, preventing and managing potential or actual financial crime risks that may arise from its business activities.

Initial Assessment of Potential AML and KYC Risks

According to the policy, Waystone conducts an initial assessment of potential Anti-Money Laundering (AML) and Know Your Customer (KYC) risks for each prospective client prior to entering into a Business Relationship. This involves:

  • Screening clients against targeted financial sanctions lists
  • Verifying their corporate object and services provided

Regulated Entities vs. Unregulated Entities

For regulated entities, such as management companies and alternative investment managers, Waystone has established a low-risk categorization based on the company’s domicile. However, unregulated entities may pose a higher financial crime risk and are subject to a more thorough due diligence process.

Ongoing Monitoring of Business Relationships

The firm also performs ongoing monitoring of its Business Relationships, verifying that client activities are in line with their corporate object and services provided. This includes:

  • Regular screening of assets against targeted financial sanctions lists
  • Verification of transactions on an ad hoc basis

Compliance with Regulatory Requirements

Waystone’s policy has been designed to ensure compliance with relevant regulatory requirements, including the EU’s Fifth Anti-Money Laundering Directive (5AMLD) and the Luxembourg Financial Intelligence Unit (FIU). The firm works closely with its internal Compliance Function and Risk Committee to identify and mitigate financial crime risks.

Internal Working Group on “Know Your Transaction”

In addition, Waystone has established an internal working group on “Know Your Transaction” to develop a framework for checks to be conducted on illiquid asset classes. The firm is also committed to reputational aspects of financial crime prevention, relying on practical compliance frameworks and seeking recourse to the Compliance Function and Risk Committee whenever necessary.

Relevant RC Services Provided

  • Due diligence services
  • AML/KYC screening
  • Transaction monitoring
  • Ongoing risk assessment and mitigation

By adopting a proactive approach to managing financial crime risks, Waystone demonstrates its commitment to maintaining the highest standards of compliance and integrity in the financial industry.