Thursday 9 February 2017

Lack of confidence in your AML/CFT program? Why?

A substantial number of compliance officers (about 44 per cent) lack confidence in the anti-money laundering (AML) programs of their organizations, according to a new report
That’s an interesting finding since compliance officers are ultimately responsible for compliance of the whole organization in their role as MLRO. The pace and complexity of changes are mentioned as causes as well as insufficient clarity of regulations. Investments in AML programs have gone up and are expected to increase also because of ongoing technological innovations.
The article quotes: Nadim Najjar, managing director, Middle East and North Africa, Thomson Reuters: “The business of compliance, which in the past was seen by many as a mere tick box exercise, has become incredibly dynamic. It has evolved into a critical, demanding role that challenges executives to stay up-to-date and conversant with regional and global regulatory change and information.”
All the reasons make sense and we see many of our clients working hard to improve their AML/CFT policies, processes and procedures. What is not mentioned – and is often still not sufficiently recognized – is that interpreting regulations into policies is only the beginning of the implementation of an AML/CFT Program.
Implementing policies in all operational areas of a financial institution would need to cover branches, trade finance departments, customer service teams, relationship managers and transaction processing units. Where the compliance function sits in the 2nd line of defense, a lot of heavy lifting in daily operation sits in the 1st line of defense.

That’s exactly what we focus on.