Financial Crime World

Vietnam’s New Anti-Money Laundering (AML) Law: Implementation and Practical Solutions

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Overview of the New AML Law

Vietnam’s new Anti-Money Laundering (AML) Law was enacted in 2020, introducing key changes and requirements for reporting entities. This presentation provides an overview of the main points discussed and practical solutions for effective implementation.

Key Changes and Requirements

  • Customer Due Diligence: Conduct customer due diligence on customers with direct or indirect interest in or control over a legal arrangement, such as a trust.
  • Correspondent Banking Relationship: Ensure that respondent banks have conducted customer due diligence on their customers when permitting correspondent banking relationships.
  • Suspicious Transaction Reporting: Report suspicious transactions to the State Bank of Vietnam (SBV) within 2 hours.
  • Good Governance and Strong Oversight: Implement effective governance and oversight to ensure compliance with AML/CFT regulations.
  • Quality Assurance (QA) Programme: Establish a risk-focused QA programme to ensure the effectiveness of the AML/CFT framework.
  • Effective Investigation: Develop adequate skills and experience for staff handling suspicious transaction alerts, and establish minimum standards for investigating alerts.

Practical Solutions for Effective Implementation

  • Good Governance and Strong Oversight: Implement an effective outsourcing programme to free up skilled resources for higher-risk transactions.
  • Effective QA Programme: Establish a risk-focused QA programme with independent reporting lines to senior management.
  • Matured QA Loop: Promote the desired AML/CFT mindset and ethical standards among employees.

Conclusion

Effective implementation of Vietnam’s new AML Law requires robust governance, culture, policy, and procedure, as well as good management reporting frameworks. By understanding the key changes and requirements, and implementing practical solutions, firms can ensure compliance with AML/CFT regulations and promote a desired AML/CFT mindset among employees.