AML/CFT Program Management and Structure

Questions and Answers

To establish minimum standards for the enterprise that are reasonably designed to comply with all applicable laws and regulations

Understanding the expectations of the relevant AML/CFT regulators and/or supervisory authorities

To identify the specific AML/CFT risks associated with the organization's business and customers

To oversee the overall management of money laundering and terrorist financing risks Signup and view all the answers

It is more flexible and adaptable to changing risks Signup and view all the answers

To mitigate the risk of money laundering or terrorist financing when it is higher Signup and view all the answers

To take into consideration the organization's business and customers' needs Signup and view all the answers

A competent advisor with expertise in AML/CFT legislation Signup and view all the answers

A more practical and intelligent approach to fighting money laundering and terrorist financing Signup and view all the answers

Because it is more flexible and adaptable to changing risks Signup and view all the answers

Study Notes

An AML function can be a standalone department, integrated into other departments, or performed by compliance personnel with other duties.

The AML/CFT program should have an enterprise-wide view of efforts, regardless of organization size.
The program should establish minimum standards to comply with applicable laws and regulations.

Policies and procedures for specific areas (e.g., private banking, trade finance) can supplement the AML/CFT program.
The program should include corporate governance and overall management of money laundering and terrorist financing risks.

Understanding laws and regulations of all jurisdictions where the organization operates and where customers are located is crucial.
Internal policies and risk-management standards related to the business must be considered.

FATF and member countries recommend a risk-based approach to AML/CFT controls.
The risk-based approach requires assessing and mitigating risks, with stronger controls for higher risks.
Identifying and mitigating risks involves applying controls such as customer verification, CDD policies, suspicious activity monitoring, and economic sanctions screening.

Flexible: Acknowledges varying risks over time and across jurisdictions, customers, products, and delivery channels.
Effective: Companies are better equipped to assess and mitigate specific risks.
Proportionate: Promotes a practical and intelligent approach, minimizing the impact on low-risk customers.