WHAT IS AN ANTI-MONEY LAUNDERING STRATEGY
Whether in the UK, Jersey, Guernsey Mauritius or elsewhere, your regulator [or international standard setters] wishes you to have an AML strategy.
- JERSEY SAYS:
- Based on its business risk assessment, the board must establish a FORMAL STRATEGY to counter money laundering and financing of terrorism.
- MAURITIUS SAYS –
- The application of a risk-based approach provides a STRATEGY FOR MANAGING potential risks by enabling financial institutions to subject customers to proportionate controls and oversight
- WOLFSBURG SAYS
- Financial Crime Risk Assessments [FCRA] are one element of the Financial Crime Compliance (FCC) toolkit available to Financial Institutions/Firms (FIs), which can strengthen a FI's compliance framework.
- The FCRA highlight
- Key risk areas,
- How well those risks are managed and support a risk-based allocation of resources to the highest risk areas,
- As well as the establishment of:
STRATEGIC (more long term) action plans for managing the identified risks and
TACTICAL (immediate workaround) action plans for managing the identified risks.
BUT WHAT DOES THIS MEAN
- Traditionally (in the past, I hope!!), conventional thinking surrounding AML strategy resulted in narrow and limited thinking (tick box!!).
- However, Today's REAL THOUGHT LEADERS in the AML space consider more than complying with the law.
HOW TO BE A REAL THOUGHT LEADER IN AML STRATEGIES
So to start, you should ask yourselves
The strategy that goes into an AML program should conside:
- How the program supports the growth of the institution;
- How the program appropriately manages the risks of money laundering and terrorist financing;
- How the program formulates a foundation for absorbing (as a centre of excellence) related financial crime risk management activities;
- How the program runs and scales with foreseen and unforeseen shifts in focus and priorities; and
- How the program affords regulators a sense of comfort in the institution's approach to combatting money laundering and terrorist financing.
The key components for developing a forward-leaning AML strategy should cover the following:
- Clearly stated goals;
- Measurable strategic objectives;
- A road map for execution; and
- A means for tracking implementation, progress, and achieved goals.
These components should be formulated by
- The board designated COMPLIANCE (RISK) Officer (MLCO/MLPO);
- Presented to the Board of Directors; and
- Be supported by any/all business units needed for the shared institutional success.
The more granular details of the AML strategy
- firstly, it should first be driven by the applicable legal/regulatory AML rules
- Second, the strategy should begin taking shape as a result of the enterprise-wide assessment of money laundering and terrorist financing risk.
- Third, a capabilities evaluation tightens the reality behind the goals and objectives.
- Finally, the solicited thought input from key constituents (internal and/or external) formulates a tangible and executable plan.
At the forefront of the road map (the strategic plan's guided forward progress) should be
- Well thought out programmatic (policies, standards, models, programs, and initiatives) and
- Operational (organizational, process, and enablers) designs.
- A well-documented strategy,
- Sets up your institution for compliance success,
- And aligns your firm's efforts into a common ground for the institution's overall success (in compliance, risk management, operational excellence, efficiency ratio, business growth, etc.).
IF YOU WANT TO DISCUSS YOUR STRATEGY CALL:
Mathew Beale - Chartered FCSI
Principal (Director) - Comsure Compliance Limited, Comsure Technology Limited (the "Comsure Group of Companies")
No 1 Bond Street Chambers, St Helier, Jersey, Channel Islands, JE2 3NP
Direct Tel: +44 (0) 1534 626841 –
Mobile Tel: +44 (0) 7797 747 490 –