Financial Crime World

Trinidad and Tobago Strengthens Regulatory Compliance Framework to Combat Financial Crimes

In an effort to bolster its efforts against money laundering, financing of terrorism, and proliferation financing (ML/FT/PF), the government of Trinidad and Tobago has emphasized the importance of developing robust compliance programs for supervised entities.

Developing a Comprehensive Compliance Program

According to recent guidelines issued by the country’s financial regulatory body, FIUTT, a compliance program is a written document outlining AML/CFT policies and procedures tailored to each entity’s unique business operations. The framework emphasizes that risk assessment is a crucial component in designing an effective compliance program.

Risk Assessment

Supervised entities must identify ML/FT/PF risks based on factors such as:

  • Customer type
  • Payment systems
  • Products and services offered
  • Jurisdictions they operate in
  • Transaction types

The program should then prioritize policies and procedures to mitigate these identified risks.

Key Components of a Compliance Program

A comprehensive compliance program, as outlined by FIUTT, must include measures for:

Customer Due Diligence

  • Conducting thorough customer identification and verification processes
  • Obtaining necessary documentation and information about customers
  • Updating records regularly to reflect changes in customer status or circumstances

Identifying and Reporting Suspicious Transactions Internally

  • Establishing procedures for reporting suspicious transactions to the FIUTT
  • Providing training to staff on identifying and reporting suspicious transactions
  • Maintaining confidentiality of reports and ensuring that only authorized personnel have access to sensitive information

Adopting a Risk-Based Approach to Monitoring Financial Transactions

  • Implementing a system for monitoring financial transactions, including cash transactions, wire transfers, and other electronic funds transfers
  • Identifying high-risk transactions and taking appropriate action, such as reporting suspicious activity to the FIUTT or freezing suspect accounts

Conducting External and Independent Testing for Compliance

  • Engaging independent auditors or consultants to review and test compliance programs
  • Providing access to audit results and reports to the FIUTT

Retaining Transaction and Identification Records

  • Maintaining accurate and complete records of transactions, including financial statements and customer identification information
  • Retaining records for at least five years from the date of transaction

Addressing High-Risk Jurisdictions

  • Implementing additional measures to mitigate ML/FT/PF risks associated with high-risk jurisdictions
  • Conducting thorough due diligence on customers and counterparties operating in these jurisdictions

Implementation and Awareness

Implementation of the compliance program is also a critical step in Trinidad and Tobago’s efforts against financial crimes. The approved program must be signed and dated by senior management or the Board of Directors, with a copy circulated to all staff members to ensure awareness of its contents.

By developing and implementing effective compliance programs, supervised entities can play a crucial role in preventing ML/FT/PF and protecting the integrity of the financial system.