Why are you vulnerable to ML/TF?

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• Money Remittances

 

Money transfer services sector ranges from large multinational providers to small sized businesses serving a particular ethnic community to and from a particular region. Money transfer services providers usually utilise bank accounts to facilitate the transfer of money. However, these aren’t normally performed via formal banking systems and as a result, only the money remitters will have information about the originator and beneficiary of a particular transaction. Money remitters are attractive to criminals who need to move funds between countries and avoid detection by the banking industry.

Money remittance services can be used at all three stages of the money laundering process.

 

DIA has rated the money remittance sector as overall high risk in its 2019 Sector Risk Assessment.

 

• Currency exchange

 

The currency exchange sector is of significant high risk when overlapped with money remittance services. Key vulnerabilities of this sector include the ease of access, global spread and ability to process large cash transactions.

 

DIA has rated the currency exchange sector as overall medium-high risk in its 2019 Sector Risk Assessmen

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What are the ML/TF risks faced by money services businesses?

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The money laundering and terrorism financing risks commonly associated with money services are:

• Transferring money or value for, or on behalf of, a customer.

• Trading for the customers in foreign exchange.

• Money or currency changing.

• Non-face-to-face on boarding and delivery of services.

• Informal or ‘hawala’ practices may obfuscate the origin and destination of funds.

• Country risks of various countries associated with the delivery of remittances to their destination countries.

 

Money services businesses need to undertake risk assessment to identify, access and mitigate ML/TF risks.

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What services are covered by the AML/CFT Act 2009?

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The following services provided by money services are captured by the AML/CFT Act 2009:

• Providing money remittance services either in cash form or through online banking.

• Providing currency exchange services.

 

If you provide any of these services in your ordinary course of business, you are required to comply with the AML/CFT Act 2009.

 

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What is a Risk Based Approach AML/CFT regime?

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The AML/CFT regime is focused around the risk based approach, which means your compliance programme needs to be based on the risk assessment and appropriate to your business environment. You should not hire any consulting firms that tell you they have templated solutions for you to comply with the AML/CFT Act as each risk assessment and compliance programme should be unique to your business and practice.

 

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How can Riskverse help?

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We offer solutions that are easy to understand so you are not confused with the complicated terms generally used by ‘experts’ in this field.

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The following solutions may assist you in understanding your obligations and complying with the AML/CFT Act:

• AML/CFT Training: We provide customised training based on your risk environment and offer easy to understand examples to help your staff understand what needs to be done.

• AML/CFT Consulting: We can work with you to undertake risk assessments and design compliance programme which are unique to your business. Each risk assessment and compliance programme that we help you draft will be specifically designed for you and will not be based on a template copied from another company, so we make sure it is appropriate to your environment.

• AML/CFT Independent Audit: Our specialised CAMS qualified experts will carry out independent audit under Section 59 of the AML/CFT Act and provide recommendations to help you evaluate compliance and enhance overall control environment.