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.

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.

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:

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.

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.).