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Presented by Legal Unit
February 21, 2018
NATIONAL RISK ASSESSMENT&
MUTUAL EVALUATION REPORT
Key RisksNational Risk Assessment
Areas of VulnerabilityIMPACT RANKING**
AML Laws and Regulations (Preventive measures and supervision)
Quality of AML Supervision 1
Market Pressure to Meet AML Standards
Commitment to Good Corporate Governance
Penalties
Enforcement of AML Obligations 5
Staff Integrity 4
Staff Knowledge 1
Compliance Function
AML Monitoring Systems 3
Corporate and Trust Transparency
Identification Infrastructure 6
Availability of Independent Information Sources
**The darker the colour is, more priority the variable has.
0.60
0.70
0.70 0.60 0.60
0.600.70
0.70
0.67
0.80
VULNERABILITY MAP
0.60
0.70
0.600.60
0.69 0.60
0.60
0.60
0.50 0.70
QUALITY OF GENERAL AML CONTROLS
QUALITY OF AML OPERATIONS
COMIT. LEAD. MANAGEMENT
AML MONITORING SYSTEMS
AML REGULATIONS
Integrityof Staff
COMPLIANCE FUNCTION
Law Enforcement
Market Pressure for AML
CDD FRAMEWORK
STAFF COMPLIANCE
Enforcement
Penalties
ID Infrastructure
Corporate and Trust Transparency
Independent info Sources
Quality of Supervision
Corporate Governance
Knowledge of Staff
AML POLICIES AND PROCEDURES
0.76
0.54
0.86
0.73
0.71
0.78
0.64
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.52
0.39
0.58
0.50
0.59
0.53
0.55
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0 0.2 0.4 0.6 0.8 1.0
Life Insurance Plans with Cash Value and…
Pure Protection Life Insurance Plans - excluding Single…
Other Insurance Plans With Cash Value and…
Pure Protection Life Insurance Plans - excluding Single…
Single Premium Life Insurance - Non-Group
Pension Products Non-Group
Non-Life Insurance Products with no Cash value or…
0
0
0
0
0
0
0
0
0
PRODUCT/SERVICE VULNERABILITY
LEGEND
Vulnerability
Inherent Vulnerability
Scenario Analysis
L
ML
M
MH
H
0.580.62
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
SECTOR VULNERABILITY
0.60
0.50
0.00
0.20
0.40
0.60
0.80
1.00
1 2 3 4 5 6 7 8 9 10
QUALITY OF GENERAL AML CONTROLS
L
ML
M
MH
H
Vulnerability Factors
Quality of the AML Supervision and StaffKnowledge
AML Monitoring Systems
Staff Integrity
Enforcement of AML Obligations
Identification Information
AML/CFT Policies and ProceduresCorporate GovernancePenalties for non-compliance
Quality of Your AML Supervision?
Knowledge of the employeesRelevant legislationCompliance Culture
Annual AML ExaminationICB’s onsite inspections and offsite monitoring programmes
AML Monitoring SystemsMust adequate and appropriate monitoring
systemsManual or SophisticatedReliance on personal recognition is not sufficient
Staff IntegrityFraudProper vetting of employeesLack of integrity leaves company
vulnerable to the criminal element.
Enforcement of AML Obligations
Enforced By Whom?Country
Individual Management Staff
Administrative Penalties, POC Bill, 2018Penal sanctions, POC Bill, 2018
Supervisory Authority/RegulatorAdministrative Penalties, i.e. Sanctions, Fines (s. 237, IA)
Identification Information
Reliable
Reliance on personal recognition
Lack of a national ID database
Non-availability to companies Independent
MITIGATION OF RISKS
Financial Transactions Reporting Bill, 2018
Proceeds of Crime Bill, 2018
Comprehensive Risk Management System
Ongoing Due Diligence
Customer Due Diligence
Compliance Officers
Concealing or Acquisition- On summary conviction - Up to 7 years imprisonment or a fine up to $500,000 - On Indictment – Up to 20 years imprisonment or a fine or BOTH
Failure to Disclose and Tipping Off- On summary conviction – Up to 12 years or a fine up
to $500,000 or BOTH- On Indictment – Up to 20 years imprisonment or a
fine or BOTH
MITIGATION OF RISKS
Enhanced Monitoring/Reporting
Review of AML/CFT Guidelines Review of AML/CFT Examination
Life Insurance Companies
General Insurance Companies
NEXT STEPS ?
BOD, Management and Staff Training
Appoint MLRO and Compliance Officer
Adequate System for Vetting of Employees
Adequate CDD and KYC policies and procedures
Conduct Risk Assessment
AML/CFT Policies and Procedures Manual
FATF RECS. DEFICIENCIES
WHAT MUST BE DONE KEY ACTIONS TO BE TAKEN
R.1 – Assessing Risk & RBA Measures have not been taken to mitigate ML/TF risks.
• Implement a risk based approach
at an institutional level.
• Implement policies, controls and
procedures which are approved
by senior management.
• Amend Legislation -FTRA
• Requirements to be included in the ICB AML/CFT Guidelines
R. 10 – Customer Due Diligence
• Ongoing due diligence.
• Require enhanced measures to identify and verify the identity of the beneficial owner of the beneficiary of a life insurance policy at the time of payout.
• Modify guidance on Simplified CDD measures --risk assessment must include an analysis of risk by the country and the financial institution.
• Amend Legislation –FTRA
• Requirements to be included in ICB AML/CFT Guidelines
CFATF MUTUAL EVALUATION REPORT
FATF RECS. DEFICIENCIES
WHAT MUST BE DONE KEY ACTIONS TO BE TAKEN
R.11 – Recordkeeping • Licensees must keep account files and business correspondence for five years after termination of the business relationship.
• Licensees must be retain the results of any analysis undertaken of an account.
• Requirements to be included in the ICB AML/CFT Guidelines
R. 12 – Politically Exposed Persons
• Require Licensees to take enhanced measures when dealing with PEPS.
• Distinguish between foreign or domestic PEP.
• Require licensees to apply measures to family members or close associates.
• Requirements to be included in ICB AML/CFT Guidelines
CFATF MUTUAL EVALUATION REPORT
FATF RECS. DEFICIENCIES
WHAT MUST BE DONE KEY ACTIONS TO BE TAKEN
R.19 – High Risk Countries • Ensure that licensees conduct Enhanced Due Diligence (EDD) and apply it proportionate to the risks from countries named by the FATF.
• Requirements to be included in the ICB AML/CFT Guidelines
R. 24 – Transparency and Beneficial Ownership of Legal Persons
Beneficial ownership information must be
maintained by companies so that they are
accurate and updated on a timely basis.
Companies must authorize a natural person
to provide BO information to, and cooperate
with competent authorities.
Supervisory authorities and licensees must
be required to keep information on BO for
five years after the date on which a company
is dissolved or otherwise ceases to exist.
• Legislation – FTRA
• Requirements to be included in ICB AML/CFT Guidelines
R. 26 – Regulation and Supervision of Financial Institutions
• Recommendation that companies be required to seek ICB approval for changes at the senior management level.
• Risk-based supervision must demonstrate that consideration was given to ML/TF risks of financial groups or country.
Legislative Amendment to Insurance Act under consideration
CFATF MUTUAL EVALUATION REPORT