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Central Bank Embraces Risk-Based Approach to Combat Money Laundering and Terrorist Financing

Kingston, Jamaica - The Central Bank of Jamaica has taken a significant step towards strengthening its defenses against money laundering and terrorist financing by adopting a risk-based approach (RBA) to assessing and mitigating these threats.

A Risk-Based Approach

The RBA is informed by various factors, including national risk assessments, peer review assessments, and financial sector assessments. The Central Bank’s Corporate Risk Management Department will conduct ongoing assessments to account for new risks and changing circumstances.

According to the bank’s policy document on Corporate Risk Management Framework, the RBA must be based on a practical, comprehensive, and up-to-date understanding of threats and vulnerabilities. It must also include commensurate measures that are clearly defined and applied.

Key Risks Identified

The Central Bank has identified several key AML/CFT/CFP risks, including:

  • Corrupt officers and employees
  • Undue influence from the private sector or politically exposed persons
  • Use of its services to commit or facilitate money laundering or terrorist financing

In response, the bank has implemented enhanced measures to address these risks. These include:

  • Proper identification of threats, risks, and vulnerabilities
  • Effective and timely responses to emerging issues

Factors Considered

The RBA will also consider a range of threats and vulnerabilities, including:

  • Money laundering and terrorist financing methods and trends
  • Cyber-related crimes
  • Economic, geographical, or social environment factors
  • Regulatory, institutional, and economic environmental weaknesses
  • Gaps in AML/CFT/CFP laws and regulations

Commitment to Combating Money Laundering and Terrorist Financing

The adoption of the RBA is seen as a major step forward in the Central Bank’s efforts to combat money laundering and terrorist financing. The bank is committed to ensuring that its services are not used for illegal purposes and is working closely with regulatory authorities to prevent the use of its services to facilitate these crimes.

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